The Bank of England is reconsidering its previous suggestion to strictly limit the amount of stablecoins that companies can hold.
According to a Bloomberg report released on October 7, officials are exploring ways to allow exceptions for firms that rely on these digital assets to operate.
This change in approach appears to be a response to concerns within the crypto industry and increased pressure from global developments.
Did you know?
Subscribe – We publish new crypto explainer videos every week!
What Is Tether? (USDT SIMPLY Explained With Animations)
In particular, the United States has advanced with clearer rules through the GENIUS Act, which may be encouraging UK regulators to remain flexible and competitive.
Initially, the Bank of England proposed firm limits on stablecoin holdings, £20,000 for individuals and £10 million for companies. These proposals aimed to reduce the risk of disruption to the financial system, particularly from stablecoins like USDT
The limits were also intended to help protect consumers and preserve the central bank’s ability to manage the economy.
While such restrictions may be acceptable for most traditional companies, they could cause difficulties for businesses that are deeply involved in the digital asset industry.
Crypto-native firms often need to hold large amounts of stablecoins to manage trading activity and maintain liquidity. The Bank now appears open to granting exemptions where this is necessary.
Recently, nine banks across Europe began working together on a new digital currency tied to the euro. What are they aiming to achieve? Read the full story.
