The UK government is planning to establish a regulatory framework for the cryptocurrency industry by early next year. This move comes as the European Union's Markets in Crypto Assets (MiCA) regulations come into effect across the EU. According to Economic Secretary Tulip Siddiq, the government aims to engage with firms on draft legal provisions for the crypto asset regime, including stablecoins, as early as possible next year.
The announcement follows a period of uncertainty regarding the government's plans for the industry. The previous government had introduced measures to regulate crypto activities, and the new Labour government intends to implement these proposals in full. The plans include creating regulated activities, such as operating a crypto trading platform, and introducing a market abuse regime.
Stablecoins will no longer be subject to the UK's payments regime, and staking will be exempt from being treated as a collective investment scheme. The European Union, the UK's largest trading partner, has already implemented its crypto regulations, with MiCA's rules on stablecoins taking effect in June and the remaining regulations coming into effect by the end of the year.