UK and US to Collaborate On Regulating Crypto Sector

The British government reportedly plans to work with American officials to regulate the cryptocurrency industry.

The two countries will hold talks “to support the use and responsible growth of digital assets,” U.K. Chancellor of the Exchequer Rachel Reeves said in a speech at the Innovate Finance Global Summit on Tuesday (April 29).

“For the U.K. to be a world leader in digital assets, international cooperation is vital,” said Reeves, whose comments were reported by Bloomberg News.

In addition to these remarks, the British Treasury has also published draft legislation on cryptocurrencies that will be finalized later in the year, the report added.

The U.S., meanwhile, has seen its regulators — including the Securities and Exchange Commission (SEC), Federal Deposit Insurance Corporation (FDIC) and the Federal Reserve — begin to clarify their positions on crypto.

As PYMNTS wrote earlier this week, this shift has meant the agencies “reversing or softening previous warnings and setting the stage for greater integration of crypto assets into the mainstream financial system.”

At the center of these changes is the SEC, which has long held a cautious — and some would say adversarial — position on crypto. Among its most pressing issues has been the regulatory treatment of crypto custody: whether and how regulated financial institutions can hold digital assets on behalf of customers.

“It is important for the SEC to grapple with custody issues, which are some of the most challenging as we seek to integrate crypto assets into our regulatory structure,” said SEC Commissioner Hester M. Peirce, leader of the agency’s Crypto Task Force.

The Bloomberg report noted that the U.K.’s cross-continental outreach comes in the wake of misgivings among European Union officials about the impact of President Donald Trump’s pro-crypto worldview on other countries.

In March, the European Central Bank’s Francois Villeroy de Galhau said the U.S. risks creating another financial crisis due to its support of cryptocurrencies and non-bank finance.

“The United States risks sinning through negligence,” Villeroy de Galhau, a member of the bank’s governing council, told French weekly La Tribune Dimanche. “Financial crises often originate in the United States and spread to the rest of the world. By encouraging crypto assets and non-bank finance, the American administration is sowing the seeds of future upheavals.”

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