The UK government has introduced new regulations aimed at overseeing cryptocurrency exchanges, dealers, and agents for the first time, with the goal of combating fraud while encouraging innovation in the sector.
Finance Minister Rachel Reeves announced the move on Tuesday, describing it as a key part of the government’s broader effort to boost growth and consumer protection in financial services.
Under the proposed laws, crypto firms operating in the UK or serving UK customers will be required to meet clear standards on transparency, consumer protection, and operational resilience.
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Regulating to foster innovation and safety
“The government will bring forward final cryptoasset legislation at the earliest opportunity, following engagement on the draft provisions with industry,” the UK Treasury said in a statement.
The draft rules follow growing concerns about the risks of unregulated digital assets and a surge in consumer participation. Around 12 percent of British adults now own or have owned cryptocurrencies, up sharply from 4 percent in 2021, according to research from the Financial Conduct Authority (FCA).
“Today’s announcement sends a clear signal: Britain is open for business — but closed to fraud, abuse, and instability,” the Treasury added.
Finance Minister Reeves discussed the proposed regulatory framework with U.S. Treasury Secretary Scott Bessent during a visit to Washington last week. The UK and US are now planning to explore deeper cooperation on digital asset regulation through the Financial Regulatory Working Group, including a possible transatlantic sandbox for digital securities proposed by SEC Commissioner Hester Peirce.
Reeves emphasized that the move supports the UK’s ambition to become a global hub for digital asset innovation. “Through our Plan for Change, we are making Britain the best place in the world to innovate — and the safest place for consumers,” she said.
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Industry Reaction and Broader Strategy
Commenting on the proposed regulations. Nick Price, financial services and crypto specialist at law firm Osborne Clarke, described it as a “simple and straightforward piece of legislation” that brings “certainty and stability and consumer protection.”
Also, Simon Treacy, a financial services lawyer at Linklaters, said while the rules define the scope of what will be regulated, “a lot more detail was still to come” as regulators refine implementation plans.
The final legislation is expected to be introduced before the end of the year, ahead of the FCA’s broader crypto regulatory roadmap set to conclude in 2026.