UK moves towards regulating crypto, seeks to become global hub

At the height of summer, when most policymaking grinds to a halt, the UK took a major step forward in its goal of becoming a crypto hub when King Charles III granted the Financial Services and Markets Bill (FSMB) the Royal Assent, formally making the bill an act of law.

Tucked within this comprehensive act – which gives regulators more powers over the financial services industry – are provisions for digital assets. The act enables the country’s treasury, the Financial Conduct Authority (FCA) and its central bank to treat crypto as a regulated activity, meaning secondary legislation can now be introduced to regulate the sector.

Other provisions include bringing stablecoins within the scope of existing payment rules and enabling the supervision of crypto promotions.

This comes as the UK tries to establish itself as a crypto hub after facing various stops and starts. In recent years, digital asset firms have struggled to register with the FCA, while the UK government halted its Royal Mint non-fungible token (NFT) plans in March. Some of the country’s biggest digital asset conferences have also now dropped capital city London as a location for their events.

Now with crypto’s inclusion within FSMB, the UK is seen as taking a measured approach to the industry. Venture capital firm Andreessen Horowitz (a16z) commended the government on seeing “the promise of Web3” as it set up its first international outpost in the country. Britain’s Prime Minister Rishi Sunak said he’s determined to turn “the UK into the world’s Web3 centre.”