UK Crypto Hub Ambitions Stall as Reforms Lag Behind Global Peers

The UK’s ambition to become a global cryptocurrency hub has faced delays, with regulatory progress lagging despite past promises from political leaders. Former Prime Minister Rishi Sunak’s 2022 pledge to reform crypto laws, including measures like recognizing stablecoins and establishing a “Cryptoasset Engagement Group,” has yet to translate into concrete action. The Labour government, now in power, has not prioritized crypto policy, with observers noting a lack of clear focus on the issue [1]. Industry experts like Tom Spiller of Rosenblatt Law highlight the current administration’s cautious approach, stating that crypto remains “not a key mission” for the government [2].

However, some developments signal cautious optimism. The April 2025 HM Treasury consultations and the Financial Conduct Authority’s (FCA) CP25/14 paper suggest a gradual shift toward treating crypto as a legitimate asset class under the Financial Services and Markets Act (FSMA). These initiatives propose frameworks for stablecoin issuance and staking but stop short of enacting binding rules [3]. James Harris of fintech firm Tesseract noted that while the tone of government policy has tilted toward “pragmatism” over ideological resistance, the pace remains slower than in the US or UAE [4].

A key legislative effort is the Property (Digital Assets, etc.) Bill, which, if passed, would recognize digital assets as property—a “major breakthrough” for the industry. The bill’s recent parliamentary debate underscores ongoing discussions but does not resolve broader regulatory uncertainties [5]. Meanwhile, industry groups like CryptoUK continue lobbying for reforms, including fairer banking access and updated advertising rules. Spiller also pointed to the need for better management of seized crypto assets, noting opportunities to optimize $7 billion in government-held digital assets for public benefit [6].

Comparisons with global peers highlight the UK’s challenges. While the EU’s Markets in Crypto-Assets (MiCA) framework and the US’s CLARITY Act signal more definitive regulatory approaches, the UK’s fragmented policy landscape risks driving talent and capital abroad. Harris emphasized that “robust tools” for Anti-Money Laundering compliance already exist within the industry, but current laws fail to categorize crypto projects effectively, necessitating more nuanced regulations [7].

The industry’s future hinges on whether the UK can accelerate reforms. Harris argued that while “encouraging signs” exist—such as bipartisan alignment on cautious pragmatism—significant work remains to realize the “crypto hub” vision. Without decisive action, the UK may struggle to compete with jurisdictions offering clearer frameworks, potentially limiting opportunities for local innovation and investment [8].

Source: [1] [UK crypto hopes stall, but ‘encouraging signs’ are there] [https://coinmarketcap.com/community/articles/68823d858583a45a07d71367/]

[2] [UK crypto hopes stall, but ‘encouraging signs’ are there] [https://coinmarketcap.com/community/articles/68823d858583a45a07d71367/]

[3] [UK crypto hopes stall, but ‘encouraging signs’ are there] [https://coinmarketcap.com/community/articles/68823d858583a45a07d71367/]

[4] [UK crypto hopes stall, but ‘encouraging signs’ are there] [https://coinmarketcap.com/community/articles/68823d858583a45a07d71367/]

[5] [UK crypto hopes stall, but ‘encouraging signs’ are there] [https://coinmarketcap.com/community/articles/68823d858583a45a07d71367/]

[6] [UK crypto hopes stall, but ‘encouraging signs’ are there] [https://coinmarketcap.com/community/articles/68823d858583a45a07d71367/]

[7] [UK crypto hopes stall, but ‘encouraging signs’ are there] [https://coinmarketcap.com/community/articles/68823d858583a45a07d71367/]

[8] [UK crypto hopes stall, but ‘encouraging signs’ are there] [https://coinmarketcap.com/community/articles/68823d858583a45a07d71367/]