The UK’s former chancellor has warned Britain will lose its competitive advantage in financial services if it does not ramp up its crypto efforts.
The UK has less than one year to catch up or it will lose its leadership in global financial services, Hammond told Bloomberg. Lord Hammond, who stepped down as chancellor in 2019 and is now a Peer, said it’s “frankly quite shocking” that Britain has been outpaced by other finance hubs, such as the European Union, which has already begun work on a framework for regulating digital assets.
“This is not the natural order of things,” the politician told Bloomberg.
Hammond recently joined London-based digital asset custodian Copper as an adviser. The company caters to over 400 institutional clients, holding and trading crypto on their behalf.
“It’s credible that 2022 is available as a catch-up period,” Hammond said, but pointed out that the UK appears to be “manifestly behind the curve.”
Hammond pointed out that crypto businesses are already considering relocating their headquarters to jurisdictions which are further ahead with regulation, such as Switzerland, Monaco and Germany.
The UK is in the process of turning the screws on digital assets and the Bank of England has repeatedly called for a regulatory framework to protect customers from unbacked crypto currencies.
Earlier this month, the Financial Conduct Authority published draft rules to restrict crypto asset adverts to an audience of experienced investors and for promotions to include warnings that the assets are unregulated.
In comments to City A.M. the former chancellor said that crypto assets could give London a unique post-Brexit competitive advantage.