Global investment in the sector topped $30bn in 2021 but the government’s plan to attract some of that money lacks detail, say critics
Bitstamp launched its first effort to set up a London headquarters in 2013. The fledgling Slovenian cryptocurrency exchange was seeking a new base for its global expansion and Europe’s financial capital was developing a reputation as a hub for investment and talent in financial technology.
Part of the appeal was the opportunity to strike up an early relationship with the UK’s Financial Conduct Authority, one of the world’s most respected regulators.
The company reasoned that regulation of the nascent cryptocurrency industry was inevitable, and wanted to get ahead of its rivals.
But the plan was cut short. The FCA said it had no mandate to oversee crypto, and just two years later the exchange decamped to Luxembourg, where it remains.
The impression that the UK was not receptive to the fast-emerging digital asset world was reinforced in 2019 when the regulator banned crypto derivatives for retail investors, warning that trading them was “akin to gambling”.
In 2021, after growing into one of the top 15 cryptocurrency exchanges in the world by volume, Bitstamp tried again, when the FCA launched a UK registration scheme for companies offering crypto assets. Again, it was unsuccessful, eventually dropping its application.
Julian Sawyer, the exchange’s chief executive, says Britain needs “a long-term road map that allows us to think about where we want to invest our money and our resources . . . I think it’s a great opportunity for the UK. It’s one of our biggest markets.”
That plea, echoed by many in the cryptocurrency industry, has found a receptive audience at the top of the UK government with the finance ministry in April laying out its ambitions post-Brexit to make the country “the very best place in the world” to start and scale crypto companies.
At an event in London’s medieval Guildhall John Glen, treasury minister, appealed to offshore digital asset firms at the forefront of finance to put down roots in London. “If there is one message I want you to leave here today with, it is that the UK is open for business — open for crypto businesses.”
His speech — which was short on detail about the plan — marked the UK’s entry into a global beauty contest, featuring among others the United Arab Emirates and Switzerland. ...
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