Industry Stakeholders Believe a UK Election Won’t Derail Crypto Plans

As a researcher with experience in the crypto industry, I believe that the progress made by the U.K. government in regulating the crypto sector will continue regardless of which party wins the upcoming general election. The Conservative Party, which has been in power for nearly 14 years, has set its sights on making the country a crypto hub and has already introduced legislation to enable crypto regulation by the Financial Conduct Authority (FCA).

The crypto industry representatives assured CoinDesk that a U.K. election will not hinder the advancements made in regulating cryptocurrencies within the country.

As a researcher, I’ve been following the political landscape in this country closely. While an election date hasn’t been officially announced yet, there are strong indications that polls will take place this year. The Conservative party, which has been in power since May 2010, has taken a proactive stance towards cryptocurrencies. They’ve set their sights on making our country a major player in the crypto world by 2022. To achieve this goal, they’ve put forth a markets bill that aims to regulate cryptocurrencies under the purview of the Financial Conduct Authority (FCA), effectively treating crypto transactions as financial activities.

The Conservative Party plans to introduce legislation for crypto assets like stablecoins and staking in the near future – within weeks, even before the upcoming election. This timeline is seen as achievable by many.

As a researcher investigating the regulatory landscape of cryptocurrencies in the country, I would recommend the implementation of secondary legislation to clearly assign the Financial Conduct Authority (FCA) with the responsibility of overseeing and regulating crypto assets, encompassing stablecoins as well.

According to the government’s declaration, this is their planned course of action. No alternative reasons have been communicated as to why this isn’t possible. Consequently, assuming no unforeseen circumstances, they ought to possess these authorities prior to the upcoming national election.

As a researcher, I’ve had the opportunity to engage with Laura Navaratnam, the U.K. policy lead at the Crypto Council for Innovation. She expressed her conviction that the current Conservative government is making significant strides towards regulatory advancements in this space. Furthermore, she highlighted the proactive moves by key regulatory bodies such as the Bank of England and the Financial Conduct Authority (FCA). They have both taken important steps in this direction by releasing discussion papers on stablecoins.

As a crypto investor, I can’t ignore the fact that political instability could potentially impact my investments negatively. While it’s impossible to predict exactly how or when this might happen, I must acknowledge the risk and be prepared for potential slowdowns in the market.

Labour

The Conservatives have a limited time until an election is called, likely just a few months. When the election does occur, they will face off against their main rival, the Labour party, which currently holds the lead in public support. According to an Ipsos survey conducted in April, approximately 44% of voters plan to cast their ballots for Labour, while only 19% are committed to voting Conservative.

As an analyst, I’ve examined the latest U.K. local election results, and I can tell you that the Labour party experienced a significant surge in victory, capturing a total of 1,158 councilor seats with a gain of 186. Conversely, the Conservatives suffered substantial losses, securing only 515 seats and losing a notable number of 474. The Liberal Democrats emerged as a stronger contender, surpassing the Conservatives in seat count. According to BBC data.

The size of the majority in an election matters, Jackson said.

In his opinion, a smaller legislative majority imposes greater limitations on a political party when it comes to certain actions.

The Labour Party has expressed intentions to establish the U.K. as a leading hub for securities tokenization within its proposed financial sector strategy. Tokenization refers to the conversion of real-world assets, such as financial instruments, into digital equivalents. A thriving tokenization ecosystem is long-sought after by many in the country.

“It’s encouraging to note that Labour has pledged to support the transformation of the U.K. into a leading international center for digital tokenization within their financial services agenda, according to CryptoUK’s statement in February.”

However, Labour did not say much about how it plans to regulate crypto.

As an analyst, I would rephrase that statement as follows: “The Labour Party’s stance on this matter is something we need to explore. They cannot afford to disregard this issue.”

In their report, Labour signaled that this was merely the initial step in detailing their plans for the future of the UK’s financial services sector, implying further disclosures are forthcoming.

Varun Paul, Fireblocks’ senior director and business lead for CBDC and financial market infrastructure, expressed his viewpoint: “It’s still early before an election, so I don’t anticipate more specifics being revealed right now,” he commented. Regarding digital assets, Paul added, “Fortunately, in the U.K., it hasn’t turned into a contentious political issue like it has in the United States.”

As a crypto investor, I’ve been keeping a close eye on the ongoing debate surrounding central bank digital currencies (CBDCs) in both the U.S. and Europe. While some American lawmakers are pushing for a ban on CBDCs, others are advocating for conducting pilot projects to explore their potential benefits. On the other hand, Labour in Europe has shown its support for the Bank of England’s digital pound initiative, as indicated in its recent report.

“According to Jackson, we can expect a consistent progression in financial services and regulations, with similar trends continuing.”