How the UK can lead the next Crypto revolution
The UK government has publicly stated its ambition to be a “global cryptoasset hub,” but its regulatory progress has been slow and overly cautious compared to competitors.
While the EU has implemented its comprehensive MiCA (Markets in Crypto-Assets) framework, the UK is still in a protracted consultation phase, with a full regime not expected until late 2026.
Wrong message from UK Govt
The UK’s approach, while thorough, is creating a “chilling effect.” The Financial Conduct Authority’s (FCA) extremely high rejection rate for crypto firm registrations (over 300 applications – only 48 successful as of early 2025) sends a message that the UK is “closed for business,” stifling innovation and driving talent elsewhere.
The “next crypto revolution” is not about speculative retail trading of memecoins. It is about the tokenisation of real-world assets (RWAs) – integrating real estate, bonds, funds and art onto blockchain rails. This is the UK’s true opportunity.
The UK’s unique strength
The UK’s advantage is not in being a “wild west” crypto haven. Its power lies in its world-class financial services sector, robust legal system and institutional credibility.
The UK’s strategy of extending its existing, respected Financial Services and Markets Act (FSMA) to cover crypto – rather than creating a separate, siloed regime – is the right long-term move to build institutional trust.
Upgrading our ‘financial plumbing’ – but more pace is needed
The UK is already laying the groundwork for this institutional shift. The Digital Securities Sandbox (DSS), the FCA’s proposals for fund tokenisation, and the planned ‘digital gilt’ (a tokenised government bond) are the real gems in the UK’s strategy. These initiatives prove the UK is serious about upgrading its core financial plumbing.
The UK government has the right ambition, but the wrong velocity. We are in danger of ‘consulting’ ourselves out of a leadership position while the EU and US set the new rules of the road.
While the UK drafts its rulebook, the EU is already playing the game. Regulatory clarity, even if imperfect, is better than regulatory limbo.
The Geneva of crypto
Rather than trying to become the next crypto ‘wild west,’ the UK should aim to be the ‘Geneva’ of digital assets – the global centre for trust, stability and institutional innovation.
The real prize isn’t minting new currencies; it’s upgrading the entire financial system’s plumbing. We are well placed for this task. The UK has a centuries-long history of building the world’s best financial plumbing.
Getting crypto asset ‘on-chain’ – and fast
The first crypto wave was about creating new, volatile assets. The next wave is about putting all existing assets on-chain. This is a multi-trillion-pound opportunity tailor-made for the City of London.
The Digital Securities Sandbox is a brilliant British innovation. But it needs to be a superhighway, not a quiet country lane. We must scale it and move successful experiments into the mainstream with urgency.
We must recalibrate our dialogue from risk mitigation to opportunity enablement.
UK needs a Digital Assets Tsar
The FCA’s role should be to provide a clear, well-lit path to compliance, not just to act as a high wall.
The current FCA approval rate sends a chilling message to innovators. We are weeding out the good with the bad and failing to build the domestic ecosystem we claim to want.
The UK needs a single, high-profile ‘Blockchain Envoy’ or ‘Digital Assets Tsar’ to cut through red tape between the Treasury, the Bank of England and the FCA. We need a unified strategy, not a turf war.
National digital asset plan needed
Just as the UK has a National AI Strategy, we now urgently need a funded, cross-government ‘National Digital Asset Action Plan’ to attract VC funding, nurture talent and drive public-private partnerships.
We have a huge opportunity in front of us here in the UK: We must think clearly and act quickly to ensure we seize it.
