The UK has slated the release of its regulatory framework for cryptocurrency and stablecoins for early 2025.

Keir Starmer’s Labour Party, which assumed power earlier this year, has pledged to create a single, streamlined regime for digital assets.

But for an industry hungry for clarity, many wonder if this new approach is enough to keep the UK competitive.

“We’re behind the rest of Europe, and then other jurisdictions in Asia and the Middle East,” said Ian Taylor, board adviser to CryptoUK, lamenting the UK’s standing.

The delay places the UK behind the European Union, whose Markets in Crypto-Assets regulations for crypto exchanges and wallet providers are set to take effect by the end of the year.

One and done

The UK’s fragmented regulatory landscape has driven many firms to look elsewhere.

Tulip Siddiq, Economic Secretary to the Treasury, acknowledged the challenges but argued that a unified regime for stablecoins and staking services will provide the clarity the sector needs.

Speaking at a London conference, she said, “Doing everything in a single phase is simpler and makes more sense.”

Other experts have echoed this perspective.

“If it means you get a really considered piece of regulation in 12 to 18 months, that’s OK,” said Gillian Lynch, head of Europe at Gemini, in remarks made earlier this year.

Falling behind

The Financial Conduct Authority, tasked with overseeing the crypto industry, has faced criticism for its stringent approach.

Over the past year, 90% of crypto firms’ applications were either rejected or withdrawn due to concerns about anti-money laundering controls.

While the FCA defends its rigorous standards, critics argue the low approval rate — just three out of 32 applications in 2024 — has stymied innovation.

This delay jeopardises the UK’s ambition, initially championed by former Prime Minister Rishi Sunak, to become a global hub for crypto innovation.

Meanwhile, the US, under President-elect Donald Trump, is actively courting the crypto industry with pro-crypto policies.

Kyle Baird is DL News’ Weekend Editor. Got a tip? Email at kbaird@dlnews.com.