Cryptocurrency groups are urging the Bank of England to abandon plans to cap stablecoin holdings in the UK, arguing it is detrimental to savers, the City, and the sterling. BoE officials plan to implement a 2023 consultation paper suggesting limits on individual and business holdings to prevent large outflows.

The UK’s proposed restrictions contrast with the US Congress passing the GENIUS Act, creating a framework for stablecoin issuers without imposing limits. Global interest in stablecoins is growing rapidly, with a market capitalization of $293 billion. However, concerns remain about stability risks and potential large outflows from traditional deposits.

Crypto industry voices caution against imposing caps on stablecoins in the UK, arguing it would hinder financial innovation and competitiveness. Banks have found ways to incorporate stablecoins like USDC into their services, suggesting these instruments will be integrated into banking business models instead of posing a systemic risk.

Read more at Yahoo Finance: Bank of England’s Stablecoin Cap Proposal Criticized as ‘Restrictive’