The crypto industry prepares for potential change in the UK government as regulatory uncertainty remains.
UK Prime Minister Rishi Sunak recently announced a snap election, placing the country’s political situation into uncertainty and turmoil. In response, crypto executives have turned to the competition to gather support and lobby for clearer crypto regulation.
According to a report from Bloomberg, two nights prior to Sunak’s announcement, crypto executives gathered on a House of Commons terrace, mingling with lawmakers over wine and canapes. This event was, according to Bloomberg’s sources, organized by US-based crypto exchange Coinbase Global Inc. and its adviser, former Conservative Chancellor George Osborn. This session was claimed to be part of a concerted effort to strengthen ties with British policymakers.
While members of both major political parties attended, the crypto industry’s influence campaign has increasingly focused on the Labour Party, given its commanding and steady lead in opinion polls.
Sunak’s decision to set the election for July 4 confirmed the wisdom of this approach, but it also highlighted the uncertainty surrounding crypto regulation in the UK, as Labour has not held power since 2010, when Bitcoin was still in its infancy.
Labour leader Keir Starmer has remained largely quiet on the topic of cryptocurrencies, leaving industry insiders guessing about his intentions for regulation should his party emerge victorious.
Laura Navaratnam, UK policy lead at the Crypto Council for Innovation, suggested that even Labour may not have a clear stance yet, claiming that while everyone else is “trying to guess” what Starmer’s intentions are for the country’s crypto sector, it’s also possible that Labour does not know “what they think yet.”
The upcoming elections in the UK and US, set just four months apart, represent a critical juncture for the crypto industry. Since the previous electoral cycles, the sector has experienced a severe market downturn and intensified regulatory scrutiny. However, the past year has also brought a remarkable resurgence, marked by the approval of Bitcoin and Ether exchange-traded products in both countries.
In the US, the crypto industry is bolstering campaign contributions to crypto-friendly candidates to sustain this positive momentum. Meanwhile, in the UK, the focus has been on cultivating relationships with Starmer and the Labour Party.
“We’re fearful that if the government delays too long in getting a full regulatory package in place, we’re going to be way behind our competitors,” said CryptoUK board advisor Ian Taylor.
The crypto industry’s wish list for the UK includes swiftly introducing comprehensive regulations, reviving the stablecoin legislation proposal, easing restrictions on marketing crypto products, and addressing difficulties in obtaining banking access. However, the fate of these objectives remains uncertain, particularly if Labour takes the reins of government.
As the election approaches, crypto executives are also turning their attention to key Labour figures such as Rachel Reeves, the shadow chancellor, and Tulip Siddiq, the shadow city minister. These two figures are likely to oversee efforts to restore London’s status as a global financial hub post-Brexit should Labour secure a win.
The crypto industry is also adapting its political messaging to resonate with a potential Labour government. Rather than emphasizing pro-market and pro-competition themes, companies are prioritizing grassroots outreach in Labour strongholds and demonstrating how digital assets can benefit ordinary people.
