Key Takeaways
- Coinbase CEO Brian Armstrong has criticized the Bank of England’s proposed cap on stablecoin holdings.
- The Bank of England’s framework would cap individual systemic stablecoin holdings at £20,000 and business holdings at £10 million.
- Armstrong’s comments come amid ongoing U.S. legislative debates over the CLARITY Act.
Coinbase Chief Executive Brian Armstrong criticized proposed U.K. stablecoin restrictions as an “innovation blocker” on Tuesday, as a petition urging Britain to adopt a more crypto-friendly framework surpassed 80,000 signatures ahead of a March 3 deadline.
Brian Armstrong Takes Aim at U.K. Proposals
In a Feb. 24 post on X, Armstrong warned that draft rules under consideration by the Bank of England risk undermining the country’s competitiveness in the digital economy.
“Stablecoin rules in the U.K. are being finalized, and are at risk of preventing the U.K. from being globally competitive in the digital economy,” Armstrong wrote.
He specifically pointed to a proposed cap on stablecoin holdings for individuals and businesses, saying the current direction of the rules “will act as an innovation blocker.”
“The U,K has a long history of being a financial hub. Embracing and encouraging innovation, especially when other countries are moving fast here, is important for maintaining that,” he added.
Armstrong shared a petition organized by Stand With Crypto U.K. calling on the government to appoint a blockchain and crypto czar and explore “a pro-innovation stablecoin and tokenisation regulatory regime.”
At the time of reporting, the petition had gathered 81,217 signatures, with more than a week remaining to reach its 100,000-signature target.
The Proposed Rules and Industry Concerns
The Bank of England last year proposed capping individual holdings of systemic stablecoins at £20,000 ($26,350) and business holdings at £10 million ($12.7 million).
Under the proposal:
- Individuals would be limited to £20,000 per systemic stablecoin.
- Businesses would be limited to £10 million per systemic stablecoin.
- Large firms could request higher limits if they demonstrate operational need and robust risk controls.
The central bank has also proposed requiring issuers to hold 40% of reserves in non-interest-bearing central bank accounts.
Some crypto-friendly lawmakers and industry executives have warned that the measures could limit innovation and slow adoption, while others argue the framework would provide regulatory clarity.
Foreign-issued stablecoins such as USDC and Tether’s USD token could continue operating in the U.K.
However, they would remain classified as non-systemic unless they achieve significant use in sterling-denominated payments.
Brian Armstrong’s CLARITY Act Pushback
Armstrong’s intervention in the U.K. debate comes as he has also taken a firm stance on stablecoin legislation in the U.S.
In January, Coinbase withdrew support for a Senate draft of the CLARITY Act after Armstrong objected to provisions he said would restrict stablecoin rewards.
He also raised concerns that the bill would grant excessive authority to the Securities and Exchange Commission (SEC) relative to the Commodity Futures Trading Commission (CFTC).
“We’d rather have no bill than a bad bill,” Armstrong wrote at the time.
Speaking at an event at Mar-a-Lago, Armstrong criticised what he described as resistance from incumbent industries.
“For whatever reason, sometimes incumbent industries have trade groups, and they view the world with a zero-sum mindset,” he said.
“We now live in this world where we have regulated U.S. stablecoins with rewards. You have to accept that as a reality and decide if you want to treat that as an opportunity or as a threat.”
However, he has also recently taken a more positive stance on the progress of the legislation, claiming it could be passed “within a few months.”
After he spoke out against the U.K. proposals, some social media users questioned whether Armstrong should prioritise U.S. legislation before weighing in on foreign regulatory debates.
“Let’s worry about the CLARITY Act in the United States before we start worrying about other countries,” one X user wrote.
“If the CLARITY Act doesn’t pass in the US, it doesn’t matter what any other country does with crypto at that point.”
U.K. Stablecoins And Competitiveness
The competitive question for the U.K., industry executives say, is whether a tightly controlled regime will safeguard financial stability while preserving London’s status as a global financial hub.
Under the proposed U.K. framework, Britain is looking to remove the risk of large-scale outflows from commercial banks into digital tokens and prevent instability in the event of a rapid loss of confidence in a major stablecoin.
By imposing caps and liquidity requirements, policymakers aim to contain systemic risk while allowing innovation to proceed within defined guardrails.
However, critics worry that caps on holdings may restrict everyday use and institutional adoption, while the requirement to place reserves in non-interest-bearing accounts may limit issuers’ margins.
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Kurt Robson is a London-based reporter at CCN, specialising in the fast-moving worlds of crypto and emerging technology. He began his career covering local news in Cornwall after graduating from Falmouth University with First Class Honours in Journalism. There, he cut his teeth on everything from council meetings to missing swans.
He quickly rose through the ranks to become a frontline journalist at several of the UK’s leading national newspapers. Over the years, he has interviewed musicians and celebrities, reported from courtrooms and crime scenes, and secured multiple front-page exclusives.
Following the upheaval of the COVID-19 pandemic, Kurt shifted his focus to technology journalism—just ahead of the AI boom. With a natural curiosity and a trained eye for emerging trends, he has found a new rhythm in reporting on innovation.
At CCN, Kurt's work focuses on the cutting edge of crypto, blockchain, AI, and the evolving digital world. Drawing on his background in people-first reporting and his deep interest in disruptive tech, Kurt delivers stories that are insightful, entertaining, and human-centric.
