UK and US Strengthen Crypto Ties with New Regulatory Push

UK Chancellor Rachel Reeves has confirmed that the United Kingdom will collaborate with the United States on cryptocurrency regulation, emphasizing the need for international coordination to secure the UK’s leadership in the global digital asset industry. The move aligns with recent U.S. efforts to embrace the crypto sector more rapidly.

In a meeting with U.S. Treasury Secretary Scott Bessent last week, Reeves discussed advancing the UK-US Economic Prosperity Agreement, reinforcing their shared vision for financial innovation and regulatory clarity in the digital economy.

As part of this vision, Reeves introduced draft legislation aimed at integrating cryptocurrency exchanges and brokers into a regulated framework similar to traditional financial institutions. Under the proposed rules, activities such as running crypto trading platforms, issuing or storing stablecoins, and facilitating crypto transactions will require authorization from the Financial Conduct Authority (FCA).

The new framework also introduces classifications for “qualifying cryptoassets” and “qualifying stablecoins” as specified investments, marking a significant step in legitimizing the sector while improving investor protection. However, decentralized finance (DeFi) protocols without a central authority will remain outside these regulatory requirements, preserving innovation in the permissionless finance space.

This regulatory overhaul is expected to be in place by the end of 2025 and is designed to boost market confidence and drive responsible growth in the UK’s digital asset ecosystem. Reeves’ announcement signals a firm commitment to positioning the UK as a forward-thinking hub for crypto innovation, while ensuring that oversight keeps pace with rapid industry developments.

By working closely with the U.S., the UK aims to align global standards, reduce regulatory arbitrage, and enhance cross-border cooperation in the evolving crypto economy.