UK Moves to Ease Stablecoin Capital Rules, Diverging From EU’s MiCA

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The proposal from the U.K.’s Financial Conduct Authority (FCA) comes after the Bank of England reversed its earlier plan to cap how much stablecoin an individual could hold.

The FCA has lowered the proposed capital requirements for stablecoin issuers as part of its formal cryptocurrency regulatory framework.

Under the revised rules, issuers would need to hold reserves equal to 1% of the total value of their stablecoins, down from the previously proposed 2%.

According to the regulator, the adjustment is intended to make the prudential framework more proportionate for larger issuers while preserving the overall strength of the system.

This requirement is notably below the European Union’s Markets in Crypto-Assets (MiCA) regulation, which maintains a 2% standard.

The FCA said the broader goal is to streamline the regulatory regime and make it more practical to implement.

The move follows the Bank of England’s decision to drop its proposed £20,000 ($26,500) limit on individual stablecoin holdings.

Globally, regulators have been rolling out formal crypto oversight frameworks, with stablecoins becoming a key focus area.

The FCA is also seeking to simplify rules for crypto exchanges. Under the proposed framework, exchanges would be required to allocate 40% of their trading capital to cover potential losses and apply a 40% haircut to collateral used in lending or trading activities.