Britain will begin regulating cryptoassets from October 2027, according to an announcement from the finance ministry on Monday. The government hopes the new regulations will provide certainty to the industry while keeping out “dodgy actors”. The forthcoming law, to be introduced into parliament later on Monday, will extend existing financial regulations to companies involved in cryptoassets. This move aligns Britain more closely with the United States rather than the European Union, which already implemented crypto-specific regulations in 2024. According to a ministry spokesperson, the draft bill giving effect to regulation has undergone only minor changes since its initial publication earlier this year.
Finance Minister Rachel Reeves stated that the rules would provide “clear rules of the road”, strengthen consumer protections, and keep “dodgy actors” out of the market. Daniel Slutzkin, head of UK at crypto exchange Gemini, said firms had “long awaited regulatory clarity” and could now start preparing to meet the new requirements. The US is pursuing what is perceived by the industry to be a more crypto-friendly approach than Britain.
Britain’s regulatory regime for cryptocurrencies is taking shape, with the Financial Conduct Authority planning bespoke rules for trading and market abuse, custody and issuance. Furthermore, the Bank of England unveiled its proposals last month for regulating stablecoins – a type of cryptocurrency – used for everyday payments. Both the Bank of England and the FCA have promised to finalise their rules by the end of 2026.
Despite these regulatory developments, regulators continue to warn about the risks associated with cryptocurrencies, cautioning investors to be prepared to lose their entire investment. Natalie Lewis, a partner at Travers Smith, told Reuters she hoped the changes in the final legislation would be “more than minor” as there were “quite a few technical legal problems with the original draft”.
