Britain moves toward crypto regulation from 2027 as UK aims to lead global digital asset adoption
Regulatory plan would bring crypto under the FCA perimeter, aiming to protect investors and spur growth, officials say.
Britain will regulate crypto assets from 2027, a move officials say could position the United Kingdom as a global hub for digital asset adoption. The government is set to announce the regulation on Monday, with City Minister Lucy Rigby saying the changes will allow Britain to lead the world in digital asset adoption. The plan would bring cryptocurrencies under the regulatory perimeter used for traditional financial products and require providers to meet standards set by the Financial Conduct Authority (FCA). The administration argues the framework will be proportionate, fair and growth-oriented while enhancing consumer protection.
Under the proposed rules, cryptocurrencies such as bitcoin would face regulation similar to other financial products, not just limited elements such as promotions. The government says the move would bring the UK in line with the United States, while noting that Europe has built its own crypto-specific regime. Rigby framed the goal as a milestone that would balance growth, investor protection and competitiveness. "Bringing forward this legislation is a milestone. Our intention is to lead the world in digital asset adoption," she told the Financial Times. "The rules we are putting in place are going to be proportionate and fair. They are going to be good for growth, encourage firms to invest here and protect consumers as well. I don’t see any conflict between those things." The regulation was first signaled in April this year, with draft legislation outlining investor protections and growth aims. From 2027, new rules would make it easier for the government to identify and address suspicious activity and potential wrongdoing in the crypto space.
Crypto ownership has risen among Britons, with millions holding digital assets. FCA data show the average crypto holding stood at about £1,842 in November of last year, and officials have suggested that holdings have risen since then. Despite broad adoption, surveys indicate that a large portion of the public lacks understanding of crypto; a WisdomTree study estimated that around 72% of people do not fully understand cryptocurrency.
Industry observers welcomed the plan for a clearer regulatory framework. Dan Moczulski, UK managing director at Etoro, said the move to bring crypto fully within the FCA’s perimeter has been a long time coming but was a welcome step. "Crypto has matured rapidly, yet regulation has not always kept pace, and investors rightly expect the same level of protection they receive when investing in other financial products," he said. He added that, at present, regulation covers only certain aspects of crypto, such as promotions, rather than the full investment journey, a gap that can undermine confidence. "Investors need to know that crypto is being treated as a fully regulated product if they are to feel comfortable committing capital for the long term."
Pantelis Kotopoulos, UK country director at Bitpanda, voiced support for a transparent and comprehensive regime, saying the government’s proposal should balance protection and innovation. "We welcome the Government's commitment to a clear and comprehensive regulatory framework for cryptoassets and support the ambition to deliver proportionate, effective regulation," he said. "We are working closely with the UK Government and regulators to ensure that the regulatory regime is fair, balancing protection and innovation to ultimately benefit investors."
There is ongoing debate about whether the UK is keeping pace with other regions. At the Coinbase crypto forum in October, former chancellor George Osborne warned that Britain had "missed the boat" on crypto and that other jurisdictions had taken the lead. Nick Jones, founder and chief executive of Crypto fintech firm Zumo, said the latest announcements could mark a turning point for the sector in the UK. "With today's announcement, momentum is starting to snowball as we head towards 2026 – which will be the year the UK becomes serious about establishing itself as a genuine crypto hub," he said.
The government contends the regulation will protect consumers, deter illicit activity and attract investment while ensuring the UK remains competitive on the global stage. Regulators stress that the rules will cover the full investment journey and aim to provide clear standards for cryptoasset firms, exchanges and other service providers operating in the country. The path to 2027 is likely to involve further consultation and potential adjustments before the law takes effect, but officials say the objective is to deliver a stable, predictable framework for the next phase of digital asset growth in the UK.
The regulatory push is part of a broader policy strategy to position the UK as a leading financial services and technology hub. Proponents argue that a clear framework could reduce uncertainty, support innovation in fintech and digital assets, and help traditional financial institutions integrate crypto-related products securely. Critics caution that rapid or overly permissive regulation could risk stifling innovation or driving activity to more permissive regimes. As regulators prepare draft legislation, all sides agree that the balance between consumer protection and growth will be crucial to the long-term success of the UK crypto market.
