George Osborne Warns UK Crypto Lag Risks Losing Global Edge to US and EU

The UK’s position in the global cryptocurrency landscape faces mounting pressure as former Chancellor George Osborne warns of the consequences of regulatory inaction. In a recent post on X, Osborne, now a member of Coinbase’s Global Advisory Council, compared the current crypto evolution to the 1986 “Big Bang” reforms that propelled London into a global financial powerhouse. He urged the Labour government to accelerate regulatory clarity and licensing processes to avoid losing ground to the US, EU, and Asia in the digital asset race[1].

Osborne emphasized that the UK’s cautious approach risks deterring talent and capital. With 20% of UK adults already owning cryptocurrency, according to Coinbase’s 2024 report, demand for digital assets remains strong. Yet, without timely action, Osborne warns that the UK may struggle to maintain its competitive edge, particularly as the EU’s Markets in Crypto-Assets (MiCA) framework has already established a regulatory head start[1].

The former Chancellor advocates for closer UK-US regulatory cooperation, faster licensing, and a risk-based approach to crypto classification. Such measures, he argues, would streamline operations for firms like Coinbase and reinforce the UK’s financial innovation legacy. However, Osborne’s optimism overlooks the risks highlighted by the 2022 FTX collapse, which saw $10 billion in losses and underscored the need for stringent safeguards[1].

While a 2023 Bank of England study notes blockchain’s potential to boost financial efficiency, it also stresses the necessity of robust protections against fraud and volatility. Meanwhile, the Labour government is leaning toward a more conservative strategy, with plans to treat crypto similarly to gambling—a move critics say could hinder innovation[1].

As the UK grapples with balancing oversight and growth, Osborne’s call for bold action reflects the urgency felt by industry stakeholders. The outcome will shape whether the country can retain its status as a global financial leader in the digital era or risk being outpaced by more agile competitors.

Source: [1] UK’s Crypto Future at Stake: George Osborne Urges Bold Action (https://coinmarketcap.com/community/articles/68904fd5f66ec432fbcd0227/)