BANK OF ENGLAND DROPS ITS STABLECOIN HOLDING CAPS AFTER YEARS OF INDUSTRY PRESSURE — REPLACES THEM WITH A £40 BILLION ISSUANCE CEILING — AND HANDS ITSELF A NEW LEGAL MANDATE OVER “INNOVATION” WHILE IT’S AT IT

Read the actual mechanics, not the press release. For two years the Bank of England wanted to cap how many stablecoins any one person or business could hold — a rule built to keep runs small by keeping wallets small. Industry fought it, and the individual caps are gone. In their place: a single £40 billion ceiling on total stablecoin issuance in the UK, plus a lighter requirement on how much of an issuer’s backing reserves have to sit in zero-interest deposits at the Bank itself. That last part is the real number. Every pound issuers keep out of a zero-yield account is a pound they can put to work instead. Here is the part that isn’t in the press quotes: the same amendment gives the Bank of England a brand-new statutory duty — “support innovation in payments” — sitting right next to its financial-stability mandate, with an annual report to Parliament. A central bank that spent two years writing caps just got a permanent, legal seat at the table for whatever comes next. Industry won this round. It also just handed the referee a new rulebook.