Several recent regulatory steps indicate the UK might finally stop dragging its feet when it comes to crypto, argues Wirex CEO Chet Shah.

Then-Prime Minister Rishi Sunak announced the UK’s ambitions to be a “global cryptoasset hub” all the way back in 2022. Since then, that goal has seemed more like a distant aspiration rather than actuality. But several recent announcements suggest the gap between fantasy and reality might finally be narrowing.

Within days of each other, the Financial Conduct Authority (FCA) and Bank of England have taken major regulatory steps toward proving that the UK is serious about that goal, setting out rules designed to create a workable climate for both consumer and institutional crypto adoption.

The FCA finalized their crypto rules last month, offering guidance for crypto firms’ capital requirements, admissions and disclosures, and the wider conduct framework. Separately, the Bank of England has scrapped the previously proposed limits imposed on holdings of fiat-pegged stablecoins, as well as lowering the reserve requirement issuers must hold at the central bank from 40% to 30%.

Together, they are the clearest signal yet that the UK intends to build a leading crypto regime rather than simply talking about it.

Chet Shah is the CEO of Wirex Limited, a FCA-regulated fintech firm based in London.

A reputation earned the hard way

It's no secret that the UK's crypto industry has lagged behind on the global stage for the past few years. The Bank of England’s earlier stablecoin proposals, set out in November 2025, faced strong industry backlash for being too restrictive to support growth. Those plans included restricting individuals to holding no more than £20,000 of systemic sterling stablecoins, while businesses were capped at £10 million. Many argued that this was too conservative to allow stablecoins to be utilized at scale, and would fundamentally hold back the UK’s competitiveness.

Prior to that, the FCA’s approach to crypto regulation was widely regarded as overly cautious, with unclear rules on how firms should operate, slow authorization times, and unworkable FinProm rules, which dictate how financial products and services can be marketed toward UK consumers.

More recently, the UK crypto sector faced another hurdle: several major financial institutions have restricted or blocked customer transactions to all crypto exchanges, citing concerns over fraud and money laundering, despite many of those exchanges already being regulated by the FCA. Many critics believe this has created another unnecessary barrier to the UK’s competition and innovation

Benchmarking against other jurisdictions

Whilst the UK has dragged its feet, global stablecoin adoption has grown astronomically, with the number of unique holders of non-dollar stablecoins having grown 30x between January 2023 and February 2026, according to Visa and Dune’s Beyond Dollarization report. Most of this activity is driven by real-world payments, settlement and payroll, not speculation.

Other jurisdictions recognized the opportunity presented by stablecoins some time ago and are well on their way to implementing the kind of regulatory certainty that enables growth. The EU’s MiCA framework began with stablecoin-specific rules, seeing Euro stablecoin transfer volume growing from $270 million to $8 billion a month in the period that followed. The US has since followed with the GENIUS Act, replacing a patchwork of state and federal guidance with enforceable standards for reserve assets, redemption rights, disclosures and custody.

Ultimately, the jurisdictions that succeed as global crypto hubs will be those offering certainty to firms operating within their rules, while genuinely incorporating industry feedback as those rules evolve.

Listening and evolving

The most encouraging part of the recent UK announcements is that both regulators have shown a willingness to adjust their proposals in response to industry feedback.

What were previously seen as excessive stablecoin reserve requirements have, after the Bank of England took industry concerns on board, been adjusted to make stablecoins commercially viable rather than a burden on the consumers and institutions holding them. The FCA has also agreed to work with the Bank of England on the stablecoin regime, and will consult later this year on how the FCA rules will apply once a stablecoin issuer is designated systemic, meaning the Treasury deems it large enough to matter to the wider financial system. This is a hugely positive step for cross-department collaboration that has historically been a sticking point for firms navigating a regulatory model that has split responsibilities between the Bank of England and the FCA.

Even so, many are hoping that this isn’t the finished product. The £40 billion cap on the circulation of any single systemic sterling stablecoin remains a small figure compared to the market cap of the biggest stablecoins like USDC and USDT. Whilst this is a sensible interim step, and the Bank has signaled its intention to revise or remove it as stablecoins become more embedded in the financial system, this should continue to be reviewed in line with evidence and ongoing engagement with the industry if the UK wants to stay competitive.

What comes next

The UK crypto industry is now working towards October 2027, when it becomes mandatory for any firm operating in the UK to be authorized under the new crypto regime, with a series of industry consultations for feedback still to come before this. If the Bank and FCA continue to take feedback in the way they have in recent weeks, then UK regulation stands a good chance of striking the right balance: protecting consumers and attracting talent, whilst encouraging innovation. This is something the industry has been waiting a long time to see, and would usher in the kind of institutional credibility that could see the UK become a genuine global crypto leader.

Large parts of the UK's digital asset framework remains yet to be finalized, including DeFi guidance, operational resilience standards for firms using distributed ledger technology, and the tax treatment of digital assets. With a new Labour leader expected within weeks following Prime Minister Keir Starmer's resignation, continuity of policy through that transition will be an early test of whether the UK's crypto ambitions can survive contact with politics. It's important that this agenda doesn't become a political football, as has happened in other jurisdictions like the United States.

Note: The views expressed in this column are those of the author and do not necessarily reflect those of CoinDesk, Inc. or its owners and affiliates.

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