APPG Welcomes Bank of England Decision to Scrap Stablecoin Holding Limits
The Crypto and Digital Assets All-Party Parliamentary Group (APPG) has welcomed the Bank of England’s decision to abandon its previously proposed limits on how much stablecoin individuals and businesses could hold in the UK.
The move marks a significant shift in the Bank’s approach to stablecoin regulation and has been widely welcomed across the digital assets sector. The APPG has consistently argued that the original proposals risked putting the UK at a competitive disadvantage compared with other major international markets and could have hampered the development of a thriving domestic stablecoin ecosystem.
The Crypto and Digital Assets APPG is Westminster’s leading cross-party group of parliamentarians focused on supporting the development of the UK’s crypto and digital assets sector and helping ensure the UK becomes a global leader in digital finance and innovation.
The APPG has also praised the Bank of England for listening to the concerns raised by Parliament and industry and for taking the decision to revise its original approach. The Group believes the move demonstrates a welcome willingness to engage with stakeholders, respond to evidence, and adopt a more proportionate framework that supports innovation while maintaining appropriate safeguards.
Welcoming the announcement, APPG Co-Chairs Gurinder Singh Josan CBE MP and Lord Vaizey of Didcot said:
“We warmly welcome the Bank of England’s decision to remove its proposed stablecoin holding limits. This is a significant and positive step forward for the UK’s digital assets sector and one that will be welcomed by businesses, investors and innovators across the industry.”
“The APPG has consistently raised concerns that the proposed limits risked putting the UK out of step with other major international markets and could have held back the development of a competitive UK stablecoin market. It is encouraging to see the Bank listening to feedback from industry and Parliament and adapting its approach.”
“Stablecoins have the potential to play an important role in the future of payments and digital finance, creating new opportunities for innovation, investment and economic growth. As jurisdictions such as the United States, the European Union and others continue to move ahead, it is vital that the UK remains internationally competitive and avoids creating unnecessary barriers to innovation.”
“The UK has made clear its ambition to be a global leader in digital assets, and achieving that goal will require a regulatory framework that supports innovation, attracts investment and enables new technologies to develop and scale in the UK. Yesterday’s announcement is a big step in the right direction and sends a positive signal that the UK is serious about competing in the global digital assets market.”
APPG Previously Raised Concerns Over Stablecoin Limits
The announcement follows a period of sustained engagement by parliamentarians and industry stakeholders on the Bank of England’s proposed stablecoin framework.
The APPG has previously expressed concerns that limits on stablecoin holdings could undermine the UK’s ambitions to become a leading global centre for digital assets and financial innovation.
In October last year, during a House of Lords debate, Lord Vaizey of Didcot questioned the rationale behind proposals to restrict how much stablecoin individuals could hold. He warned that such measures risked sending the wrong signal to international investors and firms considering establishing operations in the UK, and questioned whether the approach could discourage crypto businesses from locating here.
Lord Vaizey reiterated those concerns in November, noting that no other major international jurisdiction had introduced comparable holding limits. While recognising the importance of managing financial stability risks, he argued that the UK must ensure its regulatory framework enables innovation rather than inhibiting it.
The APPG believes the Bank of England’s revised approach strikes a more proportionate balance between supporting innovation and managing potential risks. As the UK continues to develop its wider digital assets regulatory framework, the Group will continue to work constructively with Government, regulators and industry to help ensure the UK remains an attractive destination for investment, innovation and growth in digital assets and blockchain technologies.
To find out more about the APPG or to get involved, please get in touch via the contact form on the APPG page.
