The UK cannot afford to send mixed messages on crypto

The United Kingdom is paving the road for cryptocurrency services, courting startups and established players alike while leading the way in pioneering regulation on stablecoins and nonfungible tokens.

But a lot has changed. After two years of deliberations, European Union lawmakers achieved agreement on the Markets in Crypto-Assets (MiCA) regulation, marking a pivotal moment for harmonized supervision of the sector on such a scale. This followed United States President Joe Biden’s executive order recommending a whole-of-government approach toward the responsible development of digital assets within the United States.

The U.K. has also seen major political shifts during this period, including the resignation of Treasury Minister John Glen, whose April speech supporting the industry represented the most emphatic from a U.K. official to date.

While Glen was broadly supportive of a regulated and nurturing framework for the sector, other U.K. institutions have voiced concern about the safety and viability of cryptocurrency. In fact, on the same day as Glen’s speech, Bank of England Governor Andrew Bailey called the crypto market an “opportunity for the downright criminal.”

It’s precisely this sort of mixed messaging that could hinder the industry’s development just as the starting pistol is fired. Uncertainty breeds stagnation. Evidence suggests that a lack of regulatory clarity has already put the brakes on the wide adoption of cryptocurrency by consumers.

The industry will not be able to enjoy any comfort until regulators align their thinking.

With a new prime minister and government on the horizon, it is vital that whoever takes up residence at 11 Downing Street unifies the government’s position with the Bank of England and the country’s regulators so that the U.K. can become a true leader in innovative technology and standards setting.

The crypto sector has reached a point where it is both achieving global recognition as an incubator for fast-moving financial technology and missing out due to inconsistent approaches.

Facing a crunch point in the race for global crypto leadership

The crypto market holds approximately $1 trillion in value. That figure will increase as consumer and commercial adoption grow, creating jobs, improving financial inclusion, and providing fresh alternatives to legacy systems in the financial services sector.

The U.K. is one of Europe’s leading fintech hubs and finds itself in a fortunate position, equipped with the…