From paper to rules: the Bank of England draws the reserve line at 70% gilts and 30% central bank cash, and starts the clock to 2027.

Four sentences carry the full architecture. Each one draws a boundary the November 2025 consultation left open.

The June 22 publication translates seven months of consultation feedback into five binding draft positions:

The table shows a consistent pattern: every change from November 2025 moved the rules toward commercial viability, and every unchanged element is a financial stability non-negotiable.

The UK stablecoin regime operates on a two-tier structure. The FCA layer is the entry point for every stablecoin issuer. The BoE layer activates only when HMT designates a coin systemic.

• The FCA sandbox is the rehearsal stage. Revolut, Monee Financial Technologies, ReStabilise, and VVTX are testing sterling stablecoin models in the FCA sandbox now, before the systemic regime exists. FCA full authorization opens September 2026.
• The managed transition is the growth trap. Any issuer that scales from non-systemic to systemic faces a qualitatively different regulatory regime: BoE co-regulation, 30% unremunerated central bank deposits, and the £40B cap. The architecture rewards staying small or accepting the cost of growth.

The 30% unremunerated BoE deposit is not a reserve ratio. It is a cash hold: money that earns nothing while sitting at the central bank, available to meet redemption requests immediately. The structural purpose is to ensure a systemic stablecoin behaves like cash and not like a money market fund: redemption is certain, not contingent on the issuer's ability to liquidate gilts in a stressed market. The GENIUS Act requires US Permitted Payment Stablecoin Issuers to hold 100% of reserves in T-bills or cash equivalents, but every dollar earns T-bill yield. At the current US base rate, the GENIUS Act reserve earns approximately 420 basis points annually per dollar held. The BoE's 30% earns nothing. That yield gap is the competitive cost of a sterling stablecoin franchise.

The £40B issuer cap tests commercial ambition before it limits it. USDC's circulating supply stands above $55 billion. No dollar stablecoin issuer could hold a UK systemic designation at its current scale under this ceiling. For a first-generation sterling stablecoin, £40B is a realistic upper bound over two to three years. The cap is "temporary" by design, and the BoE has signalled it will be adjusted as the regime matures. The real commercial question is whether any issuer can build a viable business on sterling when the 30% unremunerated deposit applies from day one of systemic designation.

The managed FCA-to-BoE transition creates a known decision point. The Sarah Breeden City Week speech in May promised June draft rules. They arrived on schedule. The next milestone is the September 22 consultation close: the industry's written response will determine whether the 30% unremunerated floor is accepted or contested. If the major respondents (Revolut, the FCA sandbox firms, and any global stablecoin issuers seeking UK authorization) contest the floor, the BoE faces a political choice before finalizing the Code of Practice at year-end.

• No live systemic sterling stablecoin exists. The rules govern something that does not yet exist in the UK. None of the four FCA sandbox firms has received authorization, and none has announced a launch date for a sterling stablecoin product outside the sandbox environment.
• The systemic threshold is a holistic HMT judgment with no number attached. The Bank explicitly rejected published quantitative thresholds, citing the risk of sending false market signals. No issuer can calculate with certainty when its issuance will trigger BoE co-regulation. The uncertainty is deliberate and structural.
• The yield drag is real and unhedged. At the current Bank Rate of approximately 4.25%, an issuer holding 30% of reserves at zero yield loses roughly 130 basis points annually on that portion of backing assets. A GENIUS Act issuer earning T-bill yield on 100% of its reserves earns approximately 420 basis points. The yield differential is the revenue gap a sterling stablecoin issuer must recover through fees, float, or volume that a US competitor does not face.
• The final Code of Practice arrives at year-end 2026; operational rules from 2027. The consultation closes September 22. The BoE has eight weeks to digest responses and finalize the Code. The authorization gateway for non-systemic stablecoins at the FCA opens September 2026. The full regime goes live October 2027. Nothing is enforceable today.
• Megan Greene's internal BoE view is the honest counterweight. In May 2026, BoE MPC member Megan Greene said: "I think tokenised deposits are probably going to take over from stablecoins in five years." The institution publishing systemic stablecoin rules is the same institution whose senior economists predict those rules may govern a transitional instrument rather than a permanent one.

The Bank of England's June 22 publication is the third of three major stablecoin regulatory architectures now in draft or final form. The US GENIUS Act OCC final rules are due July 18 (25 days from today). The EU MiCA transitional period ends July 1, eight days from today, after which unauthorized crypto-asset service providers must cease operations or face fines of up to EUR 5 million. The three frameworks make three structurally different choices on reserve composition: the GENIUS Act requires 100% T-bills and cash, no central bank deposit obligation; MiCA requires 30% minimum in central bank deposits for standard e-money token issuers (higher for significant issuers); and the BoE requires exactly 30% unremunerated. By reserve design, the BoE and MiCA landed on the same floor. By yield economics, the GENIUS Act regime is structurally more attractive for any issuer choosing a jurisdiction.

The UK's June 22 rules also close the loop on the three watchpoints named in the May 22 BoE briefing: the aggregate cap level has been set at £40B; the first live Digital Securities Sandbox transactions are in preparation; and no US or EU issuer has yet sought UK systemic authorization. That last point is the most significant open question. A global stablecoin issuer, Circle being the most obvious candidate, seeking UK systemic authorization would immediately test whether the £40B cap and the 30% unremunerated floor are commercially acceptable to a firm already operating at much larger scale under the GENIUS Act and MiCA frameworks. As the June 22 FinCEN CIP rule illustrated, the GENIUS Act supervisory architecture is assembling at speed. The comparative jurisdiction calculus becomes live for any issuer evaluating a global licensing strategy in the second half of 2026.

The Bank of England delivered the June framework it promised in May: per-user limits abandoned, £40B issuer ceiling set, 70% gilts and 30% unremunerated central bank cash as the reserve floor, at-par redemption within 24 hours with no suspension. The draft architecture is complete. The binding question for any issuer building in sterling is whether the 30% unremunerated BoE deposit, earning nothing while a US competitor earns T-bill yield on the equivalent position, can be absorbed into a viable fee and margin structure. The September 22 consultation response from the industry, and from Revolut in particular, is the first commercial test of that question. If the floor holds, the UK systemic stablecoin regime is the tightest reserve design in the three major jurisdictions. If it moves, the GENIUS Act's 100% yield advantage narrows.

Three things to watch:

• OCC GENIUS Act final rules, July 18, 2026. Sets the reserve yield differential between the US and UK stablecoin regimes with precision. The comparison becomes exact the moment the OCC confirms its reserve composition requirements in final form.
• First HMT systemic designation. The moment HMT designates its first sterling stablecoin as systemic, the £40B cap and 30% floor become operational constraints, not hypothetical ones. Timing and nominee are the key unknowns.
• Revolut's September 22 consultation submission. Revolut is the most commercially significant of the four FCA sandbox firms. Its written response to the draft Code of Practice, particularly on the 30% unremunerated floor and the systemic designation threshold, will be the clearest read on whether the industry accepts the framework or signals a renegotiation.