FCA lowers stablecoin capital requirement to 1% under new UK rules
**FCA cuts stablecoin capital rule to 1%**
The UK’s Financial Conduct Authority has finalized its cryptoasset policy package and reduced the capital requirement for stablecoin issuers from 2% to 1%.
The lower ratio aims to keep prudential safeguards while easing barriers for regulated issuers. According to the FCA, the adjustment makes the regime “more proportionate” but still robust.
The full rulebook will take effect in **October 2027**. It will cover trading venues, custodians, intermediaries, issuers, and staking service providers — all will need FCA authorization to operate in the UK.
Capital thresholds define who can compete. High requirements favor large players; lower ones widen access but raise systemic risk. The FCA’s move suggests sensitivity to industry feedback that 2% was too heavy for viable issuance, particularly for sterling-backed stablecoins such as USDT or USDC equivalents.
Until the new regime begins, FCA oversight remains limited to financial promotions and AML controls.
The 2027 timeline gives firms time to adapt — but also removes any illusion that the UK’s crypto regulation is theoretical.
The cut to 1% may draw more compliant stablecoin projects to UK markets. Still, the key test will be whether regulatory clarity converts into real onshore issuance and trading activity.
(Source: FCA)
