UK Unveils Draft Regulations for Cryptocurrency Industry

The UK government has released consultation documents for proposed legislation targeting the cryptocurrency industry. These documents aim to establish a regulatory framework for activities such as exchanges and the issuance of stablecoins.

The authorities also plan to introduce new requirements for market entry and information disclosure in the digital asset sector.

The draft legislation is based on the Financial Markets Act 2023, which expanded the Treasury’s powers. Unlike the EU, where MiCA regulations are in place, the UK is still in the process of shaping its industry rules.

Finance Minister Rachel Reeves stated that the new regulations are designed to attract investment and foster the growth of the digital sector. She emphasized that the country will collaborate with the US to support the responsible expansion of the crypto market.

The document is open for discussion until May 25. The government has promised to later publish separate rules related to market misconduct and information disclosure.

Nick Price, a lawyer at Osborne Clarke, described the draft legislation as “simple and clear” in a comment to Reuters. According to him, it will provide greater certainty, stability, and consumer protection.

“Whether it will promote growth and competition remains to be seen,” he noted.

Simon Tracey, a lawyer at Linklaters, highlighted that the new rules define which assets and services fall under regulation, but detailed guidance for companies will follow later.

Back in December 2024, the FCA proposed to restrict public offerings of cryptoassets outside specialized trading platforms.