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The U.K.’s Financial Conduct Authority (FCA) has softened its proposed capital requirements for stablecoin issuers, following the Bank of England’s decision to drop plans for a cap on individual holdings.
Under its updated crypto framework, the FCA now requires issuers to hold reserves equal to 1% of the total value of stablecoins in circulation, down from the earlier 2% proposal.
The regulator said the change is intended to create a more proportionate prudential regime for larger issuers while preserving overall financial stability.
The revised threshold sits below the European Union’s Markets in Crypto-Assets (MiCA) rules, which maintain a 2% requirement.
The FCA added that the adjustments aim to streamline the framework and make it more practical to implement.
The move comes after the Bank of England abandoned its proposed £20,000 ($26,500) limit on individual stablecoin holdings.
As regulators worldwide continue to formalize crypto oversight, stablecoins remain a central focus.
The FCA also proposed simpler rules for crypto exchanges, requiring them to reserve 40% of trading capital against potential losses and apply a 40% haircut to collateral used in lending or trading activities.
