Syed Rahman details the requests being made in a bid to boost the crypto sector
Six British trade associations have asked Prime Minister Keir Starmer’s office to take specific action to promote the crypto industry.
Following the favourable treatment shown to crypto by the new United States government, the UK trade bodies are calling for the appointment of a special envoy dedicated to crypto and for the creation of an action plan for digital assets and blockchain technology.
In the letter, the bodies ask Varun Chandra, the Prime Minister’s special adviser on business and investment, for a “greater strategic focus and alignment to deliver investment, growth and jobs” in the crypto sector.
The letter was written on behalf of the UK Cryptoasset Business Council, Global Digital Finance, The Payments Association, the Digital Currencies Governance Group, the Crypto Council for Innovation and techUK.
They cite US President Donald Trump’s appointment of a crypto czar and argue that Britain’s commitment to an economic trade deal involving technological cooperation with the US “presents a significant opportunity to mirror the United States’ ambition in fostering leadership in blockchain, digital assets, and other emerging financial technologies”.
The associations say that the UK should create a blockchain special envoy, similar to the US appointment, to coordinate policy, promote innovation and help place the UK in competitive positions in global markets.
As well as the call for an action plan for crypto and blockchain technology - including a concierge service to attract firms with high potential - the trade bodies want the government to ensure the most is made of the similarities between blockchain, quantum computing and artificial intelligence technologies. They would also like to see a forum created involving government, regulator and industry figures to ensure informed decision-making and collaboration across sectors.
Boost
The bodies believe that crypto and blockchain technology could boost the UK economy by £57 billion over the next decade, with the sector capable of increasing global gross domestic product by £1.39 trillion by 2030. Some commentators have voiced concerns about the UK falling behind other countries when it comes to making the most of its crypto sector talent.
Some of the propositions are realistic and a helpful reflection of the industry’s needs and wants. Others, however, are not. There will be little appetite in the UK government for simply mirroring the US approach and, therefore, it is unlikely that a crypto czar or special envoy will be appointed in the UK. It is more probable that a Treasury minister and the Financial Conduct Authority will be asked to look at how to develop the sector by bringing clarity to it and promoting innovation.
The creation of a forum is a worthwhile idea but is not strictly necessary. The trade associations and the crypto industry overall would benefit from closer collaboration and dialogue with decision makers and from the government paying closer attention to the crypto sector’s needs. But a forum would not be required if communication channels can be improved. An example of this would be the welcoming of technical comments from the crypto sector on HM Treasury’s draft legislation for the regulation of crypto assets.
Truth
Regulatory uncertainty, slow legislative processes and strong competition from other jurisdictions have resulted in the UK being a less attractive jurisdiction for crypto companies and start-ups when compared to the US (especially in recent months) and the UAE.
But the UK has undertaken many steps in recent months to ensure that this changes. The implementation of comprehensive and clear crypto regulation will give companies the certainties they need regarding the prospects of their investment being protected and allowed to grow in the UK. Similarly, a more streamlined licensing process would greatly aid companies in understanding the requirements that must be fulfilled to obtain a licence, as it would give them the necessary clarity and certainty.
