New UK Draft Rules Aim to Shape Crypto Framework and Crack Down on Abuse
The UK unveiled draft legislation on Tuesday aimed at establishing a clear regulatory framework for the cryptocurrency sector, signalling a more collaborative approach with US counterparts as it seeks to bring order to a fast-moving and often unruly space.
The proposed rules are part of the UK’s broader push to foster domestic Web3 innovation while ensuring robust consumer protection.
Speaking at a fintech conference, Finance Minister Rachel Reeves announced plans for a “comprehensive regulatory regime for crypto assets,” emphasizing the country’s ambition to become a global leader in digital finance.
🚨 At #IFGS2025, Chancellor @RachelReevesMP addressed #FinTech leaders, outlining a vision for the UK to be the best place to innovate, grow and deliver for consumers & businesses.
She launched draft cryptoasset legislation and set out plans for deeper UK-US digital cooperation pic.twitter.com/3p0J2xF5B6
— Innovate Finance (@InnFin) April 29, 2025
The new framework would extend oversight to crypto exchanges, brokers, and service providers, with the Treasury vowing to crack down on illicit actors without stifling legitimate growth.
Coordination with US officials, including investor Scott Bessent, is expected to shape future policy.
However, some in the crypto industry remain wary.
The Treasury’s statement added:
“Crypto firms with UK customers will also have to meet clear standards on transparency, consumer protection, and operational resilience — just like firms in traditional finance.”
Gilbert posted this link for a reason 👀 👀
New Draft UK legislation: https://t.co/2CYS7RKnnX$QNT https://t.co/39ezvmPjOA pic.twitter.com/w3dzrf5EvL
— ⚡️CTR@DERZ⚡️ (@C_Traderz) April 29, 2025
The Financial Conduct Authority (FCA), which handles registrations under anti-money laundering laws, has faced criticism for its strict stance, prompting concerns that overregulation could hinder innovation.
While the UK seeks alignment with US best practices, its approach appears far from hands-off.
Digital Asset Sandbox Under Discussion Between UK and US
Reeves emphasized the importance of deepening regulatory collaboration with the US to foster the “responsible” adoption of digital assets.
Reeves underscored that international cooperation is essential for the UK to establish itself as a global leader in the digital asset space.
Her comments followed a meeting with Bessent to discuss a potential trade agreement—though she noted that strengthening economic ties with the European Union remains “arguably even more important.”
Reeves said on Thursday:
“Regulation must support business, not hold it back.”
As crypto policy shifts worldwide, regulatory landscapes are evolving rapidly.
In the US, the Securities and Exchange Commission has launched a dedicated Crypto Task Force to engage directly with industry leaders, while a stablecoin regulatory framework is emerging as a national priority.
Against this backdrop, the U.K.’s proposed reforms reflect a mix of alignment and divergence—blending transatlantic cooperation with uniquely domestic priorities:
“Through our Plan for Change, we are making Britain the best place in the world to innovate — and the safest place for consumers. Robust rules around crypto will boost investor confidence, support the growth of Fintech and protect people across the UK.”
UK Treasury Releases Key Documents on Crypto Regulation Overhaul
The UK Treasury has released a series of documents outlining proposed updates to the country's crypto regulations—many of which reflect increasing alignment with US policy.
As part of this effort, Reeves recently met with Bessent to discuss key initiatives, including a potential cross-border regulatory sandbox that has gained traction among industry advocates.
The UK-US relationship has delivered prosperity for businesses and working people on both sides of the Atlantic.
Today I met with @SecScottBessent to discuss the UK-US economic prosperity deal and our goal of reaching an agreement that is in both our national interests. pic.twitter.com/6ZzPVdm62X
— Rachel Reeves (@RachelReevesMP) April 25, 2025
Reeves also revealed plans for a new UK–US Financial Regulatory Working Group to strengthen transatlantic policy coordination.
Despite signalling a more supportive stance toward innovation, the UK’s messaging remains firmly focused on curbing bad actors.
This contrasts with recent US rhetoric, which has leaned toward easing enforcement and encouraging responsible adoption.
While the UK aims to foster Web3 growth, it is doing so without embracing a hands-off regulatory approach—a position that has drawn scepticism from some in the crypto community.
Past criticisms of overreach and a rigid licensing process have led several crypto firms to exit the UK, raising concerns about the nation’s ability to retain or attract serious blockchain ventures.
The Crypto Professor claimed in response to derisive social media statements about British crypto reform.
“Sad because it’s actually true. The UK can barely operate the basics, yet they want to lead the digital era? Delusional!”
Sad because its actually true.
The UK can barely operate the basics, yet they want to lead the digital era? Delusional 😅 https://t.co/9EnMIO6Nvk
— The Crypto Professor (@TheCryptoProfes) April 29, 2025
Still, it may be premature to dismiss Britain’s potential.
The government has pledged to deliver a detailed crypto regulatory roadmap by July, leaving room for meaningful shifts—especially as UK–US collaboration deepens.
The coming months will be critical in determining whether Britain can balance innovation with oversight and reclaim its footing as a competitive player in digital finance.
