- The UK plans to introduce integrated cryptocurrency regulation, including stablecoins, in early 2025.
- The new rules aim to simplify supervision and prevent restrictive staking classifications.
- The Labor government aims to compete with the EU’s MiCA regulations and the US’ cryptocurrency-friendly policies.
The UK is set to introduce a comprehensive regulatory framework for cryptocurrencies, stablecoins and cryptocurrency staking services in early 2025, marking a significant shift in its approach to digital assets.
The announcement was made by Tulip Siddiq, Minister of Finance and Economic Affairs, at City & Financial Global’s Tokenization Summit in London on November 21.
Implementation of the regulations, originally scheduled for December 2024, was postponed due to a change in government following Prime Minister Keir Starmer’s Labor election in July 2024.
Upcoming UK cryptocurrency regulatory framework
The upcoming framework consolidates regulations for cryptocurrency assets into one comprehensive regime. Siddiq described this decision as “simpler and more logical.”
The framework aims to provide clarity to a fast-growing sector facing uncertainty in the UK.
Stablecoins will receive separate treatment under these regulations because their functionality does not match existing payment service rules.
Siddiq emphasized that the staking service will avoid being designated a “collective investment scheme,” a classification that could impose burdensome restrictions.
The UK aims to align with the global cryptocurrency regulatory environment.
The UK government’s new focus on digital asset regulation comes as it seeks to keep pace with global developments. The European Union’s Markets for Cryptocurrency Assets (MiCA) regulation will be fully implemented by the end of 2024, providing regulatory certainty that positions Europe as an attractive market for the cryptocurrency industry.
Meanwhile, under President Donald Trump’s administration, the United States has adopted a distinctly cryptocurrency-friendly stance, including the establishment of a ‘cryptocurrency czar’ in the White House and the resignation of SEC Chairman Gary Gensler in January 2024.
The Labor government has demonstrated its determination to keep up with international competition. In September 2024, a bill was introduced to recognize NFTs, cryptocurrencies, and carbon credits as property.
The new regulatory push reflects the UK’s ambitions to restore trust as a cryptocurrency hub while addressing criticism of the Financial Conduct Authority’s strict oversight.
By providing a strong and efficient framework, the Labor government aims to strengthen the UK’s position in the multi-billion dollar cryptocurrency industry.