Uk moves ponderously towards becoming crypto hub

Since announcing that the UK wants to become the go-to hub for crypto worldwide Sunak’s government has moved extremely slowly in this direction.

The UK financial sector

The UK – conservative, traditional, and set in its ways. This does not sound like a go-getting country that will rapidly modernise its financial infrastructure in order to accept cryptocurrencies into the mainstream.

Much of the wealth accumulated by the UK has been through banking and by using its financial clout across the globe to become a once dominant financial powerhouse.

However, as financial markets across the world have grown to compete with the UK and Brexit has pulled the country out of Europe, things have not gone as well as before.

Perhaps the murky off-shore banking that carries on in the inner reaches of the City might continue to make wealth but who knows where that ever ends up?

And then there’s the Bank of England, whose governor Andrew Bailey, when asked about Bitcoin, said: “People collect all sorts of things”, and also expressed the view that Bitcoin has “no intrinsic value”. 

So all in all, not a particularly fertile ground for a crypto sector set to become the world’s twelfth asset class and a breeding ground for the most innovative technology that the financial world has arguably ever seen.

Britcoin by the end of the decade?

In a move supposed to tell the world of the UK’s arrival on the world crypto stage, it was recently announced that the UK wanted to develop and issue its own cryptocurrency, which the media have dubbed “Britcoin”, with the desire to get it out by the ‘end of the decade’.

According to the UK-based National News, Professor Nicholas Ryder from Cardiff University was quoted as saying:

“The consultation has certainly been a long time coming and it represents several years of planning by the government. The plan is to make the UK the epicentre of the global cryptoasset market,

He added:

“However, the government must draw a very fine balancing act between encouraging financial innovation and tackling the threat presented by financial crime.”

Of course financial crime must be prevented, but some of the proposed regulations for AML, KYC appear to be doing away with any kind of privacy at any cost. 

If the UK wants crypto companies to set up on its shores then it has to adapt quickly and not bog crypto companies down with onerous and costly requisites. Perhaps not a likely occurrence under the current regime.

Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.