The Bank of England will focus on advancing a systemic stablecoins regime, setting out policy clarity on tokenised collateral under UK EMIR, and broadening the scope of the Digital Securities Sandbox in 2026, according to Sasha Mills, the bank’s Executive Director for Financial Market Infrastructure.
Speaking at the Tokenisation Summit, Mills said the coming year would be “fundamental in shaping the UK’s digital financial future.”
“We have the opportunity to build truly holistic digital financial markets in the UK, bringing real benefits to the real economy,” Mills said.
Under the proposed stablecoin framework, systemic issuers would receive deposit accounts at the Bank of England, with a potential liquidity facility as a backstop.
The backing structure is set at 60% short-term UK gilts and 40% Bank of England deposits. Temporary holding limits of £20,000 for individuals and £10 million for businesses are also under consideration.
Mills noted that stablecoins “have the potential to modernize retail and wholesale payments, enabling faster, cheaper and more efficient transactions.”
The bank aims to finalize the systemic stablecoins regime by year-end, working alongside the Financial Conduct Authority.
On tokenized collateral, the bank plans to issue policy guidance on how such assets can operate under the existing UK EMIR rules. Mills said tokenised versions of assets already eligible as regulatory collateral could also qualify, subject to appropriate risk mitigation.
Building on this work to support safe experimentation with new market structures, the Digital Securities Sandbox is also being expanded to include regulated stablecoins for wholesale settlement testing.
Mills stressed that resilient Financial Market Infrastructures, risk-based supervision, and international collaboration are essential to unlocking innovation while protecting the stability of the financial system.
