A group of British industry organizations have appealed to the UK government for a greater “strategic focus” on digital assets and expose a “special envoy” devoted to the sector.
In a March 31 letterThe cohort of six British trade agencies for digital economy wrote to Prime Minister Kier Starmer’s Business and Investment Special Advisor, the goods Chandra, to “highlight the value proposal for digital access and wider blockchain ecosystems” and urges the government to “remain proactive and competition to attract companies, talent.”
Trade agencies, Britain’s Cryptoasset Business Council, Techuk, Global Digital Finance, Payments Association, Digital Currency Group and Crypto Council for Innovation, specifically pointed to the change in US digital asset policy since the election of President Trump, as well as his exploit, as well as his appointment, as well as his appointment, as well as his appointment, as wellCrypto Czar. “
“New geopolitical events, namely Election of Donald TrumpHas dropped a global digital race to capture the economic and social benefits of this new technology wave, ”wrote the trade bodies.
“Britain’s positive commitment to economic trade agreements from the United States Britain with a focus on technological cooperation provides a significant opportunity to reflect the US ambition to promote leadership in blockchain, digital assets and other emerging financial technology.”
The letter suggested four important recommendations to help shape a dedicated government’s digital access plan plan and blockchain technology, including a “concierge service to attract high potential companies.”
Four core suggestions
First among the four core requests described in the letter was that Britain would follow the US leadership and appoint a blockchain Special envoy to ensure that regulation and innovation develop hand in hand “by leading international cooperation, attracting investments and creating a structured feedback trail between the government and the industry.”
Subsequently, the letter required a dedicated government action plan, akin to Britain’s approach (AI), to identify important opportunities and challenges in the blockchain space, focusing on attracting investments.
Third, the trade bodies said that the government must recognize synergy among blockchain, Quantum computers and AIAs claims that only by utilizing these techniques “in harmony”, the UK will “strengthen the blockchain thesis by strengthening safety, scalability and functionality and thus catalyzing broad-based adoption and support.”
Finally, the letter called for improved education. Specifically, addressing “gaps in the government’s understanding of technology and coordination between departments”, by creating a “high level of industry government regulator commitment forum.”
If the government acts on these four proposals, argued for trade bodies, the British economy will benefit significantly.
An unused well
To fare the potential financial and economic benefits of their recommendations, industry organizations Cited new research From the blockchain analysis company Kedjalys, which found between July 2023 and June 2024 that the UK received $ 175 billion ($ 226 billion) in transactions on the chain.
It also pointed to Financial behavior authority (FCA) – Britain’s Top Finance Sector Regulator—research From 2024 who found 12% of adults in the UK, which corresponds to seven million individuals, their own digital assets, an increase of 10% from the previous year.
Together support these results a 2020 PWC reportAlso quoted by the trade bodies, that the estimated blockchain technology could increase the British economy by £ 57 billion ($ 74 billion) in the coming decade, with the public sector that is likely to have the biggest increase.
“Only the United States and China are expected to see bigger profits,” noted the industry association’s letter.
PWC report, entitled ‘Time for trust: The trillion dollar reason to rethink blockchain‘Also estimated that blockchain could increase global GDP by 1.39 trillion £ ($ 1.79 trillion) by 2030 through improved tracking, tracking and trust.
The British Government’s current strategy for digital assets
Some of the trade groups’ appeal to the government was to accelerate their existing digital asset plans.
So far, the UK has taken a somewhat “wait and see” approach to space, not introducing radical regulatory reform, such as the European Union (EU) Markets in Crypto Assets (Mica) RegulationBut neither did the Hands-off-approach that characterized the US digital asset policy-up until Trump took office.
The most important development in British digital asset policy came in September last year, then the government took up the recommendation by the Law Commission – a statutory independent body that keeps the Act on England and Wales under review and recommends reform – and introduced one invoice To create a new category of personal property for digital assets and non-fungal tokens (NFT).
This is derived from a Law Commission in July 2024 Report To highlight the lack of contemporary British categorization of personal property to report digital assets. The report proposed to introduce a “third category” to ensure that ownership related to digital assets were clear and enforceable.
This conclusion, which was eventually raised by the government, was held by the six trade bodies – in their March 31 – letter – as an example of Britain’s willingness to adapt to new technology.
“If our legal industry can be bent to future evidence of our economy, it is now time to use both the technology and our common team system to a large one for the country at large,” the associations said.
In addition to creating a new category of property to account for the unique nature of digital assets, the United Kingdom has benefited more of a measured incorporation of the sector into existing laws and regulations.
A prominent example was Passage to Britain’s law of Financial Services and Markets Law (FSMA) 2023, which gave the supervisory authorities powers to integrate digital assets into the existing financial services regulations.
The law was adopted on June 29, 2023 and came into force two months later. The bill extended FSMA’s bank rules, such as maintaining sufficient capital to withstand financial shocks and carrying out robust risk management practice to provide transparent information to customers about Stablecoins and digital assets. This meant that digital assets were officially recognized for the first time in the UK as a regulated financial business.
That too caused some distinction among the market playersMainly because of the requirement that financial campaigns be communicated by an “authorized person” and the resulting difficulty that some digital asset players had to become an authorized person – or even find one who is willing to communicate the campaign.
In November 2024, however, the new labor government suggested a broader strategy for digital asset regulation.
In his first comments after the general election in July 2024, Economic Secretary for Treasury Tulip Siddiq MP delivered Speech at the summit To highlight the government’s commitment to promote innovation in the financial sector.
Siddiq suggested that the government should be on previous proposals to create new regulated activities for digital assets, including the operation of a digital asset trading platform, as well as an extension of market abuse rules.
FCA, which FSMA made the primary controller to monitor the sector, then published its ”Crypto travel plan“Which, if followed, noted that the new digital asset regime would come into force sometime in 2026.
According to the roadmap, the government also intends to introduce, among other things, rules for trading platforms, such as location, access, matching and transparency requirements; Stablecoin requirements related to the support of assets and redemption; and custody requirements regarding registration and segregation of assets.
This increased regulatory clarity, if they were set up to encourage innovation and integrating the recommendations of market players, cannot come enough soon for the six industry organizations, which rounded their collective cases to the British government by calling for continued progress in this legislative effort to ensure that the UK remains competent.
“While some jurisdictions have struggled to provide regulatory clarity, which leads to uncertainty and an emigration of innovators, Britain makes concrete progress in creating a clear and proportional regulations,” the letter said. “It is important that we ensure that this continues, or if we risk jurisdictions such as the United States, Singapore and Hong Kong who steal a march.”
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