The BoE’s deputy governor said stablecoins from foreign jurisdictions could pose a risk to UK consumers…

Reuters reports that Bank of England Deputy Governor Sarah Breeden on Tuesday stressed the need for further clarity for British consumers about the safety of stablecoins, particularly those issued in foreign jurisdictions such as El Salvador, where major issuers such as Tether are headquartered.

Breeden pointed out that most tokens are used for cryptocurrency transactions rather than everyday payments, and pound-denominated coins only make up a small portion of the market. He said more work was needed to ensure UK users could reliably identify which coins were safe.

Regarding the BoE’s recent proposal to limit stablecoin holdings to £20,000 per individual, Breeden said this was a temporary measure to reduce stress on banks, noting that banks would need to adapt their large-scale funding structures if stablecoins gained traction.

Breeden stressed that the UK faces different risks than the US, where the adoption of cryptocurrencies is more widespread.