How are stablecoins regulated in the UK?

UK stablecoin regulation has two layers. The Financial Conduct Authority (FCA) will authorise and supervise firms that issue stablecoins in the UK. The Bank of England adds a second regime for sterling stablecoins that become widely used for payments. For the wider picture, see who regulates crypto in the UK.

What are the FCA stablecoin rules for 2026 and 2027?

The FCA published five policy statements on 30 June 2026, including PS26/10 on stablecoin issuance. Its application window opened on 30 September 2026 and closes on 28 February 2027. The new rules take effect on 25 October 2027, and from then issuers need FCA authorisation to issue in the UK.

Under PS26/10, an issuer must:

• Hold backing assets on a statutory trust for holders, in the same currency as the stablecoin.
• Keep a minimum share in core assets, meaning short-term deposits and short-term government debt, plus at least 5% in on-demand deposits.
• Use some longer-dated government debt, money market funds or repos only after telling the FCA and meeting extra conditions.
• Pay out redemptions at par by the end of the next business day after receiving the coins.

Stablecoins pegged to two or more currencies fall outside the Treasury's final legislation, so these rules do not cover them.

How does the Bank of England regulate stablecoins?

The Bank of England's role is limited to "systemic" stablecoins. HM Treasury decides which sterling stablecoins are big enough in payments to count. Stablecoins used mainly for trading crypto stay with the FCA alone.

In June 2026 the Bank published a policy statement and draft code of practice. Up to 70% of a systemic issuer's backing may be held in short-term UK government debt, with the rest in deposits at the central bank. That ratio was raised from 60% in the earlier proposal. The Bank and FCA say they are building a managed path for firms that move from the FCA regime into the Bank's.

Will there be stablecoin holding limits in the UK?

The Bank of England proposed temporary holding limits for individuals in 2025, but dropped them in June 2026. Instead, each systemic stablecoin faces a temporary issuance cap, first set at 40 billion pounds, to be reviewed and removed once risks to bank lending are handled. Feedback closed on 22 September 2026, and the Bank expects regulated stablecoins to operate in the UK from 2027.

What makes the UK stablecoin rules different?

The main difference is the two-regulator design. Most issuers will deal only with the FCA, while a sterling coin that grows into a major payment tool also answers to the central bank, with tighter backing rules and an issuance cap. Overseas regimes are covered in our guides to the EU's MiCA and the US GENIUS Act. For background on how these tokens work, read what is a stablecoin.

Rules differ by country and change often. Check the regulator or a qualified professional for your own situation.