UK Introduces New Cryptocurrency Regulations in Cooperation with the US
April 29, 2025 – London
In a significant development for the cryptocurrency market, UK’s finance minister, Rachel Reeves, announced on Tuesday that the government plans to bring cryptocurrencies under compulsory regulation. This move aligns the UK’s approach with that of the United States, aiming to establish tighter controls over the sector while promoting innovation.
New Regulatory Framework
Reeves delivered her announcement during discussions at the 2025 annual IMF/World Bank Spring Meetings in Washington, D.C. The newly proposed regulations will require all companies involved in the cryptocurrency space, including exchanges, dealers, and agents, to operate within a defined regulatory perimeter. This marks a pivotal shift in the UK’s stance, moving towards an oversight model more akin to traditional finance rather than the tailored regulatory frameworks being developed by the European Union.
The finance ministry’s statement emphasized the government’s intention to clamp down on illicit activities while simultaneously supporting legitimate enterprises within the crypto industry. “Under the new rules, crypto firms with UK customers will have to meet clear standards on transparency, consumer protection, and operational resilience,” the ministry noted.
Impact of US Regulations
The announcement comes as the US, under President Donald Trump’s administration, is taking a more welcoming stance towards cryptocurrencies, promising to roll back regulations perceived as overly restrictive. The UK government’s coordination with the US follows discussions between Reeves and US Treasury Secretary Scott Bessent, with further talks scheduled for June to solidify the bilateral strategy in managing digital assets.
The potential influence of the US approach has raised concerns among Eurozone finance ministers, who have expressed fears about the implications for financial stability and monetary sovereignty in Europe.
Growing Popularity of Cryptocurrency
According to government data, approximately 12% of UK adults either currently own or have owned cryptocurrencies like Bitcoin and Ethereum. This figure has seen a significant increase from just 4% in 2021, highlighting a burgeoning interest in digital assets among the UK population.
Bank of England Governor Andrew Bailey has consistently warned of the risks associated with cryptocurrencies, describing Bitcoin as unreliable as a store of value. Nonetheless, he supports regulating stablecoins—digital currencies pegged to stable assets—to ensure consumer protection and market stability.
Measuring the proposed regulations, users and companies engaging in stablecoins based in the UK will face strict guidelines under this initiative.
Next Steps in Legislation
The government aims to finalize this new regulatory framework by the end of the year, building on previous proposals made in 2023. Critics of the regulation caution that such measures may inadvertently give the public a false sense of security regarding the risks associated with digital assets that often lack intrinsic value.
Conversely, legal experts, including Nick Price from Osborne Clarke, welcome the proposed legislation as a necessary step towards regulatory clarity and consumer protection. “This alignment with the US approach of treating crypto as securities is a clear shift from the EU’s more nuanced MiCAR framework,” Price commented.
Future Plans for Financial Services
Looking ahead, Reeves indicated that broader plans to enhance the growth and competitiveness of the UK financial services sector will be outlined during her annual Mansion House speech on July 15. This address will be the culmination of a consultation process initiated in November 2024, reflecting the government’s commitment to fostering a robust financial ecosystem in the UK.
As the cryptocurrency landscape evolves, the UK’s initiative to implement new regulatory measures aims to strike a balance between safeguarding investors and encouraging innovation within the rapidly changing marketplace.
Reporting by David Milliken and Tommy Reggiori Wilkes. Editing by William James.
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