The UK government is preparing to introduce new cryptocurrency regulations, including provisions for stablecoins, by early 2025. This marks a significant step towards establishing a regulatory framework for the crypto industry after a delay caused by the general elections in July.
Tulip Siddiq, the economic secretary to the UK Treasury, confirmed that stablecoins—digital currencies pegged to fiat money—will not fall under the current payment services act. Instead, they will be included in new, forthcoming regulations that are expected to be outlined in early 2025.
Siddiq, speaking at the City & Financial Global Tokenisation Summit in London on November 21, explained that consolidating crypto regulations into a single phase would simplify the process. “Doing everything in a single phase is simpler and it just makes more sense,” she said.
The UK’s delayed regulatory push contrasts with other European nations, many of which, including the European Union (EU), have already implemented comprehensive crypto regulations. The EU’s Markets in Crypto-Assets (MiCA) framework, which offers enhanced consumer protections and financial stability, was enacted earlier this year. France, Switzerland, and Liechtenstein have also adopted specific crypto regulations.
The UK’s crypto sector, which has seen rapid growth, stands to benefit from clearer regulatory guidelines. Around 2.5 million adults in the UK—approximately 5% of the population—own cryptocurrency, with the market reaching a trading volume of $8.5 billion and a market size of $170 billion. Venture capital investments have also surged, with over $1.9 billion funneled into crypto and blockchain startups in 2022.
Additionally, the UK is exploring the potential for a Central Bank Digital Currency (CBDC), or Digital Pound. The Bank of England is currently in the design phase of this project, engaging with the industry for feedback.
As the UK prepares to finalize its crypto regulations, the industry is anticipating a clearer, more structured path forward for digital assets in the country.
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