UK lawmakers urge the country's Chancellor to question the Bank of England about the stablecoin plan

PANews December 12 News, according to Bloomberg, a cross-party group of UK lawmakers has urged Chancellor Rachel Reeves to oppose the Bank of England’s proposal to set a cap on stablecoin holdings in the country, stating that the central bank’s policy would undermine the government’s efforts to position the UK as a leader in the digital asset space. In a letter to Reeves, members of the House of Lords, including Peter Cruddas, CEO of trading platform CMC Markets Plc, said that the Bank of England’s plan to limit the amount of stablecoins individuals can hold would not reduce risk but would instead drive capital overseas. The group wrote, “We are deeply concerned that the UK is gradually moving toward a fragmented and restrictive approach that will hinder innovation, limit adoption, and push activity abroad.” Last month, the Bank of England announced its proposed stablecoin rules, stating that it would temporarily set a cap of £20,000 (approximately $26,350) on individual stablecoin holdings and a limit of £10 million for businesses. The bank also requires issuers of pound-pegged tokens to hold at least 40% of the backing reserves for these tokens as interest-free deposits at the central bank. These proposals have been criticized by cryptocurrency companies, which argue that they are too strict.