UK government is ready for crypto regulations next year

The United Kingdom (UK) government is preparing to create a new regulatory framework for the crypto industry, including stablecoins, by next year, officials say.

The UK’s newly formed government will push ahead with cryptocurrency regulations after being delayed by this July’s general election. Keit Starmer from the Labor Party was elected Prime Minister.

Tulip Siddiq, economics secretary to the UK Treasury and the City Secretary, said the stablecoin would not be regulated under existing payment services law. The stablecoin digital currency, which is pegged to fiat money, will be included in new regulations expected to be prepared in early 2025.

“It’s simpler and more logical to do everything in one phase,” Siddiq said at City & Financial Global’s Tokenization Summit in London on Nov. 21, according to Bloomberg.

The development of this piece of legislation has caused crypto industries to move away from Mother England. Other European countries, including regional organizations such as the European Union (EU), also implemented such regulations in the middle of the year.

This year, the EU implemented CryptoAsset Markets (MiCA) regulations, which provide a comprehensive regulatory framework for better consumer protection and financial stability in the region.

France, Switzerland and Liechtenstein are examples of other European countries that have already implemented special regulations for cryptocurrency in the country.

Growing crypto industry in the UK

It is important that the long-awaited regulations progress as the number of markets in Great Britain increases. Approximately 2.5 million adults in the UK own cryptocurrency, around 5% of the population.

The market size and trading volume also gain a huge amount, around $170 billion and $8.5 billion respectively. Venture capital will also strengthen the sector by funding over $1.9 billion for crypto and blockchain startups in 2022.

The UK was also one of the countries considering implementing a Central Bank Digital Currency (CBDC) or Digital pound. Latest information says that this development is in the design phase by the Bank of England and is being discussed with the industry.