Policy statement PS26/10 sets out final rules for UK-issued qualifying stablecoins, following consultation papers CP25/14 and CP25/41. The final rules notably cover issuance and redemption of stablecoins, backing assets (for stablecoins in issuance) and their safeguarding, and disclosures. NB that differing rules will apply for systemic stablecoins.
The FCA has largely maintained the framework it consulted on, but with some changes. Highlights include:
- not expanding the permissible backing assets or permitting backing assets to be held in multiple currencies, in order to avoid increased volatility of the backing asset pool, but leaving scope for inclusion of tokenised versions of permitted backing assets in the pool;
- simplifying the backing asset composition requirement – formerly called the backing asset composition ratio – by removing the need to estimate projected redemption levels. (The requirement applies to stablecoin issuers wishing to use expanded backing assets, rather than being limited to a more conservative set of core backing assets.);
- permitting use of an intragroup custodian for up to 20% (with limited exceptions) of the backing asset pool;
- allowing a 5% excess (i.e. buffer) in the backing asset pool;
- adjusting redemption timelines so KYC checks can be completed before the T+1 redemption period begins;
- allowing issuers choice as to the legal mechanism they adopt to enable redemption rights to transfer with a stablecoin;
- removing requirements around unallocated backing funds and unallocated backing fund accounts;
- confirming application of bespoke outsourcing rules (as well as generic related requirements);
- finalising (including in some cases clarifying or rationalising) disclosure requirements, particularly in relation to withdrawal rights and backing assets; and
- confirming that stablecoin issuers cannot pay interest, or other yield from backing assets, to stablecoin holders. To avoid circumvention, third parties are also precluded from passing on such interest or yield, but will otherwise be permitted to pay rewards. The FCA adds, however, that “we will be conducting additional work to explore the competition and economic implications of offering interest further. This does not imply our position on prohibiting interest is due to change” (but presumably leaves open the door to such a possibility).
The policy statement also confirms that UK stablecoin issuers must fully back all UK-issued qualifying stablecoins from the point of minting, including those they hold themselves.
The requirement that the backing asset pool be subject to a statutory trust for the benefit of stablecoin holders is being taken forward, but with a separate consultation to follow addressing the terms on which money and assets are to be held within the statutory trust.
Also of interest to those tracking these developments is the Bank of England and FCA joint approach to regulation of systemic stablecoin issuers, also published on June 30, 2026, available here.
