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Landmark new laws to regulate cryptoasset companies in Britain will help the country “lead the world in digital asset adoption” and attract investment, City minister Lucy Rigby has claimed.
Rigby insisted that Britain’s new crypto regulatory regime, which will take effect in the second half of 2027, would be “proportionate and fair” and would provide certainty for digital businesses and protection for consumers.
Speaking to the Financial Times, Rigby said: “Bringing forward this legislation is a milestone. Our intention is to lead the world in digital asset adoption.
“The rules we are putting in place are going to be proportionate and fair. They are going to be good for growth, encourage firms to invest here and protect consumers as well. I don’t see any conflict between those things.”
Britain has been criticised for what some in the industry claim is an overly cautious approach to embracing cryptoassets, with Donald Trump’s US administration taking a much lighter-touch approach.
George Osborne, former Conservative chancellor and a member of Coinbase’s global advisory council, wrote in the Financial Times earlier this year: “On crypto and stablecoins, as on too many other things, the hard truth is this: we are being completely left behind.”
The co-head of crypto exchange Kraken, Arjun Sethi, has also criticised the UK’s approach, saying disclosures required in Britain were “worse for consumers”.
The new legislation would establish a “comprehensive regulatory regime”, said Rigby, where crypto companies were regulated by the Financial Conduct Authority in the same way as other providers of financial products.
She said the incoming laws would support responsible innovation and ensure open and competitive markets, bringing cryptoassets into the same regime as other regulated financial products such as stocks and shares.
The FCA has said it will waive or loosen some of its rules for crypto companies, for example on customer rights to cancel a purchase and on regulations designed to manage systemic risk.
Rigby said the regime was being designed for Britain, but noted that the UK and the US had this year created a transatlantic task force to explore areas for closer financial ties.
“Our regulation is designed with domestic circumstances in mind but it makes a good deal of sense to explore mutually beneficial market access opportunities and regulatory alignment, where that makes sense for the UK,” she said.
Rigby will table secondary legislation on Monday to introduce the new regime under the 2023 Financial Services and Markets Act. The aim is to enact the regime in 2026, alongside an FCA consultation on final rules and guidance for companies.
The Treasury aims for the new rules to be ready by mid-2026, giving groups sufficient time to secure authorisation before the regime goes live in the second half of 2027.
Chancellor Rachel Reeves has been frustrated by what she believes has been excessive caution from the Bank of England over the use of stablecoins, according to government officials.
Last month the BoE diluted its planned rules for UK stablecoins in response to industry criticism by allowing some assets backing the digital tokens to be invested in short-term government debt and exempting certain businesses from ownership limits.
Rigby noted the change of stance and called on the industry to engage with the BoE as it shaped its new regime. “We are encouraging firms with strong views on this issue to respond to the bank’s consultation,” she said.
The City minister, appointed to her role in September, has reservations about one specific area involving cryptoassets: their use for party political donations.
Nigel Farage’s Reform UK has begun accepting donations in cryptocurrency, and Rigby said: “We want to ensure the right level of protection for democracy.”