Coverage: weekly note · Information to 27 July 2026
TGB Premium Intelligence · Subscriber Edition
This report is part of TGB Premium Intelligence and is available by request to qualified institutions. It will not enter the open archive for at least twelve months.
TGB Weekly Research Note · 27 July 2026
The Bank of England’s June 2026 rules treat a widely used sterling stablecoin as payments infrastructure, with backing assets kept out of commercial banks and a £40 billion issuance guardrail designed around bank funding.
The desk view
On 22 June 2026 the Bank of England published its policy statement and draft rules for systemic stablecoin issuers, and on 30 June the FCA and the Bank set out how the two parts of the regime fit together. The package treats a widely used sterling stablecoin as financial market infrastructure (FMI) rather than a fintech product. Backing assets must sit in short-term government debt and central bank deposits, never commercial bank deposits. A temporary £40 billion issuance cap per coin is explicitly a tool to protect bank credit. And the PRA wants banking groups to keep stablecoins in separate, insolvency-remote entities while tokenising deposits inside the bank. Our reading is that the regime is designed to let stablecoins compete with bank deposits for payments while limiting how quickly they can drain them.
A payments system, not a product
The Bank’s regime applies only once HM Treasury recognises a stablecoin as systemic; stablecoins used mainly for buying and selling cryptoassets, which the Bank describes as the predominant use today, stay with the FCA alone. An issuer can also be recognised as systemic at launch where it is likely to reach systemic scale. Once recognised, the issuer is jointly regulated, and the joint document describes the transition as becoming “a regulated FMI”.
The allocation of work makes the FMI character explicit. The Bank would lead on backing assets, capital and reserves, safeguarding, failure arrangements and the issuance guardrail, and the FCA on conduct, the Consumer Duty and financial crime. Capital for general business risk uses the CPMI-IOSCO Principles for Financial Market Infrastructures as its baseline, set at the higher of six months of operating expenses or the cost of recovery and orderly wind-down, with notification to the Bank below 110% of that minimum. Systemic issuers must complete redemptions within 24 hours on a rolling basis and are expected to access payment systems directly rather than through a sponsoring participant.
The timetable is now fixed in outline. Comments on the Bank’s draft Code of Practice are due by 22 September 2026 and the Bank intends to finalise it by the end of 2026, allowing regulated stablecoins to operate from 2027. The FCA regime for UK stablecoin issuance comes into force on 25 October 2027, with an authorisation window from 30 September 2026 to 28 February 2027.