- A potential Labour government in the UK could impact the crypto sector by seeing a focus on real-world asset tokenization and the development of CBDC technology, according to deVere Group CEO Nigel Green.
- The UK’s General Election takes place today, and opinion polls suggest that the incumbent Conservatives could lose in a Labour landslide victory.
A clearly defined regulatory framework is needed
Opinion polls predict that the UK’s Labour Party could secure victory in today’s General Election. According to one financial services executive, Labour leader Keir Starmer should pursue the current Conservative Prime Minister Rishi Sunak’s ambition to make the country a “global crypto hub.”
As the nation heads to the polls on Friday, deVere Group CEO Nigel Green said that although Starmer’s stance on crypto remains somewhat nebulous, the party’s shadow finance minister Rachel Reeves “has shown openness to the tech sector,” and shadow city minister, Tulip Siddiq, “has boldly stated that Labour would transform the UK into a global centre for tokenized assets if victorious.”
In an email sent to The Block, Green said that the Labour Party has highlighted in planning documents how it would “embrace securities tokenization and a central bank digital currency (CBDC)” as part of its vision for the UK.
“The cornerstone of establishing the UK as a global crypto hub lies in creating a clear, comprehensive regulatory framework,” Green noted. Green was referring to current Prime Minister Rishi Sunak’s stated goal in April 2022, when he was Chancellor of the Exchequer, to make the UK a “global crypto hub.”
He added that a well-defined regulatory environment could provide clarity and security to businesses and investors in the country. “By working closely with industry leaders and stakeholders, a Labour government can ensure that regulations are balanced, fostering innovation while safeguarding the financial system. This approach would make the UK an attractive destination for crypto companies looking for a stable and supportive regulatory climate,” he added.
Green emphasized how the City of London has historically been a leading global financial center. “By embracing cryptocurrency and blockchain technology, Starmer can enhance the City’s status. The City’s robust financial infrastructure, combined with progressive crypto regulations, can attract international businesses and investors.”
He added that the combination of London’s position as a financial center and a clearly defined regulatory framework would position the UK as a global leader in cryptocurrency, “driving economic growth, creating jobs, and nurturing innovation.”
According to Creator of the Crypto & DeFi Academy Brian Rose, it is encouraging that the potential incoming Chancellor of the Exchequer Rachel Reeves has shown openness to the tech sector. “Rumours that there are plans to address securities tokenization and launch a CBDC as part of their financial policy are a concern and I hope she works with the crypto community to develop market leading policies rather than rolling out badly conceived plans without any consultation,” Rose told The Block.
Rose added that the next government should commit to supporting a crypto revolution here in the UK, “establishing our country as a global centre of excellence for technology which will define future generations.”
Coinbase-linked advocacy group proposes crypto policies for the UK
In mid-June, Stand With Crypto — an advocacy group started by Coinbase — outlined seven UK crypto policy recommendations ahead of today’s General Election. The lobbying group launched in London with an event at the House of Commons in May organized by its adviser, former Conservative Chancellor of the Exchequer George Osborne.
The crypto advocacy group’s manifesto said the next UK government should promote the country as a global web3 and tokenization hub and establish a joint industry-government task force to identify opportunities to position the UK as such.
Stand With Crypto UK recommended swiftly legislating for crypto assets, adhering to the principle of “same risk, same regulatory outcome” to protect consumers and foster industry growth. This includes regulating fiat-backed stablecoins to encourage competition in digital payments.
The group also prioritized recognizing staking as a regulated activity and ensuring retail participation, which it said is crucial for the functioning and innovation of proof-of-stake blockchains.
