The Bank of England’s June 2026 final stablecoin framework — a £40 billion issuance cap per systemic sterling coin and a 70/30 gilt-to-central-bank-deposit reserve split — widens the gulf between the UK, the EU’s Markets in Crypto-Assets Regulation (MiCA) and the US GENIUS Act, leaving issuers to navigate three incompatible reserve regimes with no equivalence between them.
The Bank of England (BoE) confirmed in June 2026 that systemic sterling stablecoins must hold up to 70% of reserves in short-term UK government bonds and at least 30% in non-interest-bearing deposits at the central bank, while scrapping an earlier plan to cap individual holdings at £20,000 in favour of a temporary £40 billion issuance cap per coin. The decision lands two years after MiCA’s stablecoin rules took effect on June 30, 2024 and almost a year after the US GENIUS Act was enacted on July 18, 2025. This analysis walks the reserve mechanics, compares four jurisdictions, sets out the enforcement context, and maps what compliance teams must do next.
Key Facts:
• The BoE will allow up to 70% of systemic sterling-stablecoin reserves in short-term UK gilts, with at least 30% held as non-interest-bearing central-bank deposits — Bank of England, June 2026
• A temporary £40 billion issuance cap applies per systemic sterling stablecoin; individual holding limits were dropped — Bank of England
• MiCA has governed Electronic Money Tokens (EMTs) and Asset-Referenced Tokens (ARTs) since June 30, 2024 — Regulation (EU) 2023/1114
• The US GENIUS Act, enacted July 18, 2025, requires 1:1 backing in cash and short-dated US Treasuries
• The BoE consultation accepts feedback until September 22, 2026, with sterling stablecoin launches likely from 2027
• No equivalence or mutual-recognition agreement exists between MiCA and the GENIUS Act as of June 2026
Methodology and sources
This analysis is built from primary regulator material and official communications dated through June 25, 2026: the Bank of England’s June 2026 stablecoin policy position and Deputy Governor statement, MiCA (Regulation (EU) 2023/1114), the US GENIUS Act and Treasury implementing proposals, the Monetary Authority of Singapore (MAS) Single-Currency Stablecoin framework, and a Bank for International Settlements (BIS) speech on stablecoin fragmentation. The jurisdictional scope is the EU, the United States, the United Kingdom and Singapore, with reserve composition and issuance limits as the comparison axis. Caveats: the UK rules remain in a feedback window until September 22, 2026, and US implementing rules are still at proposal stage, so specific thresholds may shift before they bind.
What the UK rule actually says
The Bank of England’s framework treats systemic sterling stablecoins as a new form of money rather than as a niche payment token, and the reserve formula reflects that. Issuers may now place up to 70% of backing assets in short-term UK government debt — raised from an earlier 60% draft — with the remaining portion, at least 30%, held as unremunerated deposits at the Bank of England. The higher gilt allocation matters commercially: it lets issuers earn yield on most of the backing book, which is what makes a regulated sterling stablecoin economically viable rather than a loss-leader.
The £40 billion issuance cap is a systemic stablecoin’s holding limit, not an individual’s. The Bank of England’s final position is that systemic sterling stablecoin reserves must combine yield-bearing short-dated gilts with a non-interest-bearing central-bank deposit buffer, capped at £40 billion in issuance per coin during a transitional phase, and with no limit on how much any one user or business can hold. That structure is designed to protect financial stability — by ring-fencing a portion of reserves at the central bank for instant redemption — while removing the individual holding caps that issuers warned would make sterling coins unusable for commerce. The Bank framed the package as final in policy terms even as it keeps a feedback window open to September 22, 2026.
| Jurisdiction / Regulator | Effective date | Reserve composition | Holding / issuance limit | Sanction regime |
|---|---|---|---|---|
| UK (Bank of England, systemic) | Final June 2026; launches ~2027 | Up to 70% short-term gilts; ≥30% non-interest-bearing BoE deposits | £40 billion issuance cap per coin; no individual cap | BoE / FCA supervisory powers and penalties |
| EU (MiCA, EMTs) | June 30, 2024 | Bank-deposit floor plus high-quality liquid assets; foreign-currency limits on significant EMTs | Daily transaction caps on large non-euro EMTs | Up to the higher of €5 million or a turnover percentage |
| US (GENIUS Act) | Enacted July 18, 2025 | 1:1 cash and short-dated US Treasuries / repos (Treasuries-only model) | No federal issuance cap; bank and licensed non-bank routes | Treasury, OCC and state enforcement |
| Singapore (MAS SCS) | August 15, 2023 | Low-risk, short-dated reserve assets at 1:1; capital requirements | Single-currency peg (SGD or G10) | MAS financial penalties and licence action |
Sources: Bank of England; Regulation (EU) 2023/1114 (MiCA); US Treasury (GENIUS Act implementation); Monetary Authority of Singapore. Last updated: June 25, 2026.
How four jurisdictions compare
Reserve composition is where the frameworks diverge most sharply. The GENIUS Act is the strictest on eligible instruments, pushing issuers toward a Treasuries-only book; MiCA is the strictest on reserve location, imposing a bank-deposit floor and foreign-currency limits on significant EMTs that constrain how dollar-pegged coins operate inside the EU; and the UK now sits between them, permitting a yield-bearing gilt majority but demanding a central-bank-deposit buffer that neither the US nor the EU requires in the same form. Singapore’s Single-Currency Stablecoin regime, live since August 15, 2023, is the most established of the four and the least prescriptive on a central-bank buffer.
Why does the divergence create regulatory-arbitrage risk? Because a stablecoin compliant in one bloc is not automatically compliant in another, and no equivalence determination bridges them. An issuer optimising reserves for the GENIUS Act’s Treasuries-only rule cannot simply passport that book into the EU, where MiCA’s bank-deposit floor applies, or into the UK, where a non-interest-bearing central-bank deposit is mandatory for systemic coins. The result is that large issuers must run jurisdiction-specific reserve pools and redemption stacks, raising the fixed cost of operating globally and pushing smaller issuers toward the single most permissive regime they can serve — the classic precondition for arbitrage that international bodies have flagged.
“This is a major milestone in delivering greater choice and innovation in UK payments. Innovation thrives on trust, and these rules lay the foundations of that trust for a new form of money — with prompt redemption, strong protections and central bank support.”
— Sarah Breeden, Deputy Governor for Financial Stability, Bank of England (Decrypt)
Enforcement context
The reserve-composition debate is not academic; it traces directly to enforcement history. On October 15, 2021, the Commodity Futures Trading Commission (CFTC) ordered Tether to pay a $41 million civil penalty, finding that the issuer had made untrue or misleading statements that its USDT token was fully backed by US dollars when, for significant periods, the reserves were not held as claimed (CFTC Docket No. 22-04). The case is the reference point for why post-2024 frameworks specify reserve assets, custody and attestation in granular terms rather than relying on issuer disclosure.
That precedent shapes how today’s regimes are written. MiCA’s EMT rules, the GENIUS Act’s Treasuries-only mandate and the Bank of England’s central-bank-deposit buffer are each, in part, a response to the Tether finding: each tries to make “fully backed” a verifiable regulatory fact rather than a marketing claim. For in-scope firms, the lesson is that reserve attestation and the ability to evidence 1:1 backing in real time are now the core compliance obligation, and the regulator with the tightest reserve rule effectively sets the global floor for any issuer that wants to serve that market.
What this means for issuers, exchanges and compliance teams
For stablecoin issuers, the immediate task is reserve segregation by jurisdiction. A coin marketed across the UK, EU and US now needs distinct reserve pools that satisfy a gilt-plus-central-bank-deposit rule in Britain, a bank-deposit-floor rule in the EU and a Treasuries-only rule in the US — three different asset mixes, three custody arrangements, and three attestation cadences. Treasury teams should model the yield drag of the UK’s 30% non-interest-bearing buffer against the GENIUS Act’s Treasuries book before deciding which markets to serve at scale.
For exchanges and Crypto-Asset Service Providers (CASPs), the question is listing eligibility. A token that fails MiCA’s EMT requirements cannot be offered to EU retail users regardless of its US status, so venues must map each listed stablecoin to the regimes their users sit in. For fund managers and custodians, the £40 billion issuance cap introduces a concentration variable: a systemic sterling coin approaching the ceiling faces a hard supply constraint that affects liquidity planning. And for legal and compliance teams, the priority is documentation — reserve-composition policies, redemption procedures and real-time attestation capability that can be evidenced to whichever supervisor has jurisdiction, because none of the three major regimes will accept another’s sign-off.
“Without it, divergent regulatory frameworks for stablecoins across jurisdictions could lead to severe market fragmentation or enable harmful regulatory arbitrage.”
— Pablo Hernández de Cos, General Manager, Bank for International Settlements (Bank for International Settlements)
What’s next — the forward view
The near-term calendar is led by the UK. The Bank of England accepts feedback on its framework until September 22, 2026, and intends to finalise implementation by year-end, with the first regulated sterling stablecoins unlikely before 2027. In the United States, GENIUS Act implementation is still at the proposal stage: Treasury has floated “substantially similar” standards for state regimes, the FDIC has proposed issuer rules, and FinCEN and OFAC advanced Anti-Money Laundering (AML) proposals with comment windows in early June 2026 — so the US reserve and AML detail is not yet fully fixed. In the EU, the reopening of the rulebook under a MiCA review keeps EMT calibration in play.
The contested question is coordination. The BIS has warned that absent international cooperation the frameworks will fragment further, and as of June 2026 there is no equivalence path between the EU, US and UK regimes. Whether IOSCO or the Financial Stability Board can broker a recognition framework before the UK’s 2027 launch window is the single variable most likely to determine whether global issuers consolidate or further splinter their reserve operations.
TL;DR
The Bank of England’s June 2026 stablecoin framework lets systemic sterling coins hold up to 70% of reserves in short-term gilts with at least 30% as non-interest-bearing central-bank deposits, and caps issuance at £40 billion per coin while dropping individual holding limits. That diverges from MiCA’s bank-deposit floor (in force since June 30, 2024) and the GENIUS Act’s Treasuries-only model (enacted July 18, 2025). With no equivalence between the three, issuers must run separate reserve pools per market. The BoE consultation runs to September 22, 2026; launches are expected from 2027.
FAQ
What is the Bank of England’s stablecoin reserve rule?
Systemic sterling stablecoins may hold up to 70% of reserves in short-term UK government bonds, with at least 30% in non-interest-bearing deposits at the Bank of England. The framework was set out as final in policy terms in June 2026, with feedback accepted until September 22, 2026.
What is the £40 billion stablecoin cap?
It is a temporary issuance ceiling per systemic sterling stablecoin, not a limit on individual holdings. The Bank of England dropped an earlier plan to cap individual holdings at £20,000, allowing users and businesses to hold unlimited amounts.
How does the UK rule differ from MiCA and the GENIUS Act?
MiCA, in force since June 30, 2024, imposes a bank-deposit floor on Electronic Money Tokens; the GENIUS Act, enacted July 18, 2025, requires a Treasuries-only reserve book; the UK requires a gilt majority plus a non-interest-bearing central-bank deposit buffer. The three are not equivalent.
Is there equivalence between the EU, US and UK stablecoin regimes?
No. As of June 2026, no mutual-recognition or equivalence agreement exists, so a stablecoin compliant in one bloc is not automatically compliant in another. The BIS has warned this raises fragmentation and regulatory-arbitrage risk.
When can sterling stablecoins launch?
The Bank of England intends to finalise implementation by the end of 2026 after its September 22 feedback window, with the first regulated sterling stablecoins unlikely to launch before 2027.
What must compliance teams do now?
Run jurisdiction-specific reserve pools, build real-time attestation capability, map each listed stablecoin to the regimes its users sit in, and model the yield drag of the UK’s non-interest-bearing central-bank buffer before committing to the UK market at scale.
For related coverage, see our analyses of Hong Kong’s stablecoin licensing split, the MiCA 2 rulebook reopening, Basel’s 1,250% crypto capital rule, and AMLA’s single AML rulebook.
This article is informational analysis only and does not constitute legal, regulatory, tax, or investment advice. Regulatory frameworks change frequently and interpretation depends on facts and circumstances; primary documents and official regulator guidance always supersede summaries. Firms should consult qualified legal counsel and their relevant supervisory authority before taking any action based on the analysis above.
Rick Steves
Rick Steves has seen business and economics through many lenses. He joined the financial services industry in 2009, and has been a financial journalist since 2011. He holds a degree in Business Administration and has experience producing real-time news, from both buy-side and sell-side, as well as for retail traders, brokers and service providers. Steves' work has appeared in a variety of online publications including FX Street, NewsBTC, FinanceFeeds, and The Industry Spread. Rick has great interest in the dynamics of the trading industry. The never-ending clash between technology, economics, regulation, and more importantly, the people.
