The Bank of England (BOE) has proposed temporary limits on stablecoin holdings, setting a cap of 20,000 pounds (about $26,300) for individuals and 10 million pounds for businesses. These limitations aim to mitigate risks to the commercial banking sector during the transition to a stablecoin-inclusive financial system. The BOE plans to remove these caps once stablecoins are integrated into the financial framework. Certain businesses, like crypto exchanges and supermarkets, may be exempt from these limits due to their need for larger balances. In addition to the holding limits, the BOE has outlined a regulatory framework for stablecoin issuers. They can hold up to 60% of their backing assets in short-term U.K. government debt, with the remaining 40% in unremunerated accounts at the BOE. However, issuers transitioning to systemic stablecoins can hold up to 95% in short-term debt to support their growth. This framework is specifically for sterling-denominated systemic stablecoins used for retail and wholesale payments. Non-systemic stablecoins will fall under the regulation of the Financial Conduct Authority (FCA). The proposed limits have faced criticism from cryptocurrency advocates, who argue they could make the U.K. less competitive compared to other regions like the U.S. and European Union. Sarah Breeden, the BOE's deputy governor, indicated that these measures are necessary to prevent destabilizing effects on the banking sector, which is vital for consumers. The BOE's consultation period for feedback on these proposals will last until February 10, 2026, after which they plan to finalize their regulations for stablecoin issuers later that year.