UK Government Set to Introduce Crypto Regulations by 2025, Officials Confirm

The UK government is preparing to roll out a new regulatory framework for the cryptocurrency industry, including stablecoins, with plans for implementation by early 2025, according to officials. This move follows delays caused by the country’s general elections in July, and will proceed under the leadership of Prime Minister Keir Starmer from the Labour Party.

Tulip Siddiq, the UK’s Economic Secretary to the Treasury and City Minister, confirmed that stablecoins—digital currencies pegged to fiat money—will not fall under the current payment services regulations. Instead, they will be addressed within a new set of regulations expected to be drafted in 2025.

Siddiq emphasized that consolidating the regulations into a single phase would be more efficient, stating, “Doing everything in a single phase is simpler and just makes more sense,” as reported by Bloomberg on November 21, during the City & Financial Global’s Tokenisation Summit in London.

This development follows a series of moves by other European nations and regional organizations, including the European Union (EU), which has already introduced the Markets in Crypto-Assets (MiCA) regulations this year. MiCA provides a comprehensive framework aimed at improving consumer protections and ensuring financial stability across the EU. France, Switzerland, and Liechtenstein are among other European countries that have established their own specific cryptocurrency regulations.

Growing Crypto Market in the UK

The UK’s long-awaited crypto regulations come as the country’s cryptocurrency market continues to grow rapidly. Approximately 2.5 million adults in the UK, or about 5% of the population, currently own cryptocurrency. The market’s size has surged, with trading volumes reaching $8.5 billion and the overall market size expanding to $170 billion. Venture capital investments also surged, with more than $1.9 billion invested in crypto and blockchain startups in 2022 alone.

The UK government has also been exploring the development of a Central Bank Digital Currency (CBDC), often referred to as the Digital Pound. The Bank of England is currently in the design phase for the CBDC, with ongoing discussions involving industry stakeholders.

As the UK looks to establish its regulatory framework, the crypto sector is eager for clarity to support its continued growth and integration into the broader financial system.