The Bank of England recently published its policy statement and draft Code of Practice for systemic stablecoin issuers, a milestone that puts the UK on course to let regulated stablecoins operate from 2027. Many have on the headline number: a £40bn issuance ceiling for each systemic sterling stablecoin. But the more revealing decision was one the Bank quietly reversed.
Only months earlier, its consultation had floated per-coin holding limits of £20,000 for individuals and £10m for businesses. The industry pushed back hard, and the Bank listened. Those caps are gone, replaced by a temporary guardrail applied at the issuer level rather than the user’s. The practical effect is significant: households and businesses will be able to hold and transact in a systemic sterling stablecoin without limits on the size, frequency or type of payment.
That is a regulator optimising for usability, not just stability, and it tells you how the Bank now sees these instruments. A holding cap treats a stablecoin as something to be contained. An issuance guardrail treats it as money to be used, while managing system-level risk in the background. It is the difference between designing for a speculative asset and designing for a payment method.
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The old caps carried an implicit assumption: that a stablecoin is mainly something you hold. Holding has genuine uses, and a stable, redeemable digital balance can be a sensible way to keep value in volatile markets. But in cross-border payments, the greater prize lies in what a coin does in motion rather than at rest. Once you see a regulated coin as a payment rail and not only a balance, scrapping per-user limits is the obvious call: you do not cap how much money can pass down a wire.
The scaffolding of trust
The rest of the package reinforces the point. Backing assets can now be held up to 70% in short-term UK government debt, with the remainder in central bank deposits that stand ready to meet redemptions. That revision matters commercially: it lets issuers earn a return on reserves and build a viable business, rather than running a regulated utility at a loss. Around it sits the familiar architecture of sound money: redemption at par, a robust legal claim for the coinholder, and prompt redemption even under stress, with central bank liquidity in reserve.
Strip away the detail and the message is consistent. The Bank is building the trust that turns a token into money people can rely on, and doing so with one eye on whether issuers can actually run a business inside the rules. The intent is unmistakable: make regulated stablecoins usable.
A converging global perimeter
None of this happens in isolation. The UK is running a deliberate two-track model. The Financial Conduct Authority supervises non-systemic stablecoins, while the Bank steps in only once HM Treasury designates a coin systemic. That sits alongside the US GENIUS Act, signed in 2025 and heading toward effect by early 2027, and the EU’s MiCA regime, in force since late 2024. Three of the world’s largest payment markets are converging on the same idea in the same window: define who can issue, how it must be backed, and how holders redeem. Regulatory ambiguity has been the single biggest brake on using stablecoins for real payments rather than crypto trading, and it is lifting.
Be clear-eyed, though. A sterling-denominated systemic stablecoin is unlikely to dominate global usage any time soon. The market is overwhelmingly dollar-denominated and will stay that way. The UK’s prize is not a home-grown sterling-coin boom. It is that UK-regulated firms now have a credible basis to use regulated stablecoins in the payments they already run.
Where the value actually accrues
This is where the payments industry, rather than the issuer community, should be paying attention. For most players the question is not “should we issue a stablecoin?” It is “how do we plug regulated stablecoins into the money movement we already do?”
Take a practical case. A firm making payouts into a market like the Philippines must pre-position funds with a local partner so the money is ready the instant an instruction lands. Funded over correspondent banking, that leg can take a day or more, moves only in banking hours, and leaves capital sitting idle in transit. Funded in a regulated stablecoin, the partner can be topped up in minutes, at any hour, freeing the same working capital to do more. Multiply that across dozens of corridors and the treasury case makes itself: instead of parking capital in fragmented local-currency balances around the world, a business holds fewer, more flexible positions and a clearer view of its liquidity.
But settlement efficiency is only half the story. A stablecoin is only as useful as the network that can turn it into spendable local money: a bank account credit in Manila, a wallet top-up in Nairobi, a supplier payout in São Paulo. The genuinely hard part of cross-border payments was never the digital-asset leg. It is the last mile of local liquidity, local rails, and compliance in every market you touch, and that does not vanish because a coin is regulated. The value only lands when efficient settlement is paired with deep local reach at the far end, which is precisely the work networks like ours already do.
What to watch next
The June announcement is a milestone, but it’s a foundation rather than a finished building. The decisions that determine whether digital sterling actually gets used sit in the next set of documents, not this one: the FCA’s final rules and the joint transition framework that will govern how a coin grows from non-systemic to systemic. Apply a single test to them. Do they build bridges or walls? A regulated sterling coin has to move cleanly between on-chain liquidity, domestic rails such as Faster Payments and CHAPS, and other jurisdictions’ regimes. If those linkages are an afterthought, sterling corridors will default to dollar coins and the competitiveness the regime is meant to create will leak away.
So watch the transition framework, not the headline guardrail. The winners of the stablecoin era in payments will not necessarily be the issuers. They will be the networks that make regulated money usable at the edge, where the payment lands. That is the part the headlines miss, and the part worth building for.
Pritpal Shokar, Head of Product, Digital Assets, Thunes
