The UK’s regulatory stance on digital assets faces sharp criticism, with detractors pointing to “policy procrastination” as the reason the country is trailing the EU and the US in shaping digital finance. Market participants argue the nation is squandering its early lead in distributed ledger technology (DLT).
In a Friday blog post for the Digital Monetary Institute, an independent think tank, OMFIF Chairman John Orchard and Editor Lewis McLellan contended the UK has missed multiple opportunities regarding DLT finance.
The post, “The UK keeps missing the boat on DLT finance,” asserted that despite initial expectations for a post-Brexit gold standard in crypto regulation, the UK continues to “talk un-specifically about regulation in the future.”
Orchard and McLellan noted the conspicuous absence of a launch date for the UK’s Financial Conduct Authority’s crypto regime roadmap, scheduled for sometime after 2026.
The authors criticized the UK’s approach to stablecoins, contrasting it with the US’s specific treatment under the recently passed GENIUS Act. They stated the UK’s classification of stablecoins alongside crypto investment assets “mystifies” the market.
The Bank of England’s initial draft framework, requiring systemic stablecoins to be backed entirely by central bank money, further fueled these concerns. Although the Bank has since eased this position, a workable model remains unconfirmed.
EU and US demonstrate regulatory progress
In contrast, the European Union’s Markets in Crypto-Assets (MiCA) framework is already operational. Meanwhile, the US Senate recently approved the GENIUS Act, establishing federal regulations for stablecoins.
Other jurisdictions advance crypto rules
Other regions are moving forward. Hong Kong passed a stablecoin bill and is developing its tokenization ecosystem via Project Ensemble. The UAE’s Virtual Assets Regulatory Authority (VARA) is cited as a dedicated digital asset regulator.
The blog post acknowledged the UK’s historical fintech leadership and advantages like its time zone, language, and legal system. However, the authors warned that its position is far from guaranteed, stating “Financial centers come and go,” and urged regulators to act decisively.
