A new letter addressed to UK regulators has sharply criticized the Bank of England’s proposal to impose strict limits on how much stablecoin individuals and businesses can hold. The draft policy would introduce caps aimed at reducing systemic risk, but critics argue it could stifle innovation, push users offshore, and undermine the UK’s ambition to become a leading hub for digital assets.

The Bank of England has suggested that restricting stablecoin holdings would prevent financial instability in case of