BoE to Stablecoin Issuers: Park 40% of Reserves With Us

The Bank of England will require stablecoin issuers to hold nearly half of their reserves at the central bank, a key part of a new regulatory crackdown, as noted by Reuters.

Officials warned that looser rules could spark a credit crunch by pulling deposits from traditional banks too quickly.

“We have to manage these risks carefully,” said Deputy Governor Sarah Breeden, referencing the 2023 USDC depeg triggered by the Silicon Valley Bank failure.

The proposed regime also includes strict wallet caps: £20,000 for individuals and £10 million for firms. The message is clear: innovate, but with robust safeguards.