Minutes from the Crypto & Digital Assets All-Party Parliamentary Group (APPG) Industry Roundtable Meeting March 2024
  • Natalie Hall
  • 25 March, 2024

1. Introduction

  • Chair of the APPG Lisa Cameron MP began the meeting by welcoming attendees and thanking everyone for attending the first APPG roundtable of 2024.
  • Lisa Cameron MP told attendees that the roundtable was an opportunity for participants to update the APPG on key issues that should be considered by the APPG and to discuss some key themes following recent developments in the industry.
  • Lisa Cameron MP said that she was keen to hear from firms about their own views on the UK’s current approach to regulation of the UK crypto and digital asset sector, including any challenges they were experiencing, any concerns they have, and issues that MPs and Lords should consider.
  • Lisa Cameron MP said that it had been almost two years since the UK Government set out its landmark vision for the UK to become a global cryptoasset hub and that the APPG is keen to hear views on the progress that has been made to date and what more is required for the UK to achieve its vision.

2. Industry Speakers

3. Key Themes of Discussion

  • Following introductory opening remarks from industry speakers, Lisa Cameron MP invited attendees to participate in a wider discussion to explore some key themes in relation to the crypto and digital asset industry, specifically:
    • What progress has the Government made towards its vision of the UK becoming a global crypto hub?
    • What further action is required in order to fully realise the Government’s vision for the UK;
    • What challenges remain for the UK and industry operators in order to unlock investment in the UK?
  • Lisa Cameron MP also encouraged attendees and participants to share their views on any other issues that attendees felt the APPG should consider in relation to the crypto and digital asset industry.

Key Points of Discussion

The UK Government’s Vision:

  • The main theme of the discussion was what progress has been made in relation to the Government’s stated vision for the UK to become a global crypto asset hub as the UK approaches 2 years since the Government first announced this back in 2022.
  • The APPG heard that industry was supportive of the positive tone and bold ambition from the UK Government and welcomed the steps that the Government had taken towards providing regulatory clarity and a regulatory framework for the industry over the last 2 years which it was felt was an important factor in attracting investment and providing business certainty for firms that wished to operate in the UK.
  • The APPG also heard that there remained a number of areas where further progress could be made towards fulfilling the Government’s vision for the UK or where further scrutiny by Parliament would be welcome particularly in regards to what some described as potential barriers to growth and innovation in the UK.
  • Some participants told the APPG that whilst the Government’s position and general tone in relation to crypto was positive, in some instances this was still not reflective of operators day to day experience of operating/or seeking to operate in the UK and that there needed to be a much greater focus on implementation and delivery of the Government’s vision across the board.

Industry Engagement:

    • The APPG heard that continued and ongoing engagement between Government, regulators and industry should be a key consideration and that industry can be a key player in helping to shape future regulation and policies that are fit for purpose.
    • In particular the APPG heard that open communication and engagement between regulators such as the Financial Conduct Authority (FCA) and industry operators is an important factor in encouraging firms to choose to invest in the UK, particularly in relation to licensing and registration of crypto and digital asset businesses.
    • The APPG heard examples of other jurisdictions overseas that have embraced an open dialogue with industry and those seeking to be licensed in those overseas markets which the APPG heard has been very successful in helping firms navigate the application and licensing process.
    • The APPG heard that whilst it is important to ensure that the UK has robust standards, an overly cautious approach could be counterproductive to the UK’s goal to be a global crypto hub.

Access to Bank Accounts and Banking Services:

  • The APPG heard from many participants that de-banking and access to bank accounts remained an ongoing issue for many industry operators.
  • The APPG heard that operators were almost routinely being denied access to banking services due to the crypto related nature of their businesses.
  • The APPG also heard that some businesses that did not handle crypto or digital assets but were simply associated with it or had the word ‘crypto’ in their name were being denied banking services.
  • Other participants provided further testimony and details of numerous UK banks that had introduced restrictions or limits for crypto and digital asset service providers over the last 12-18 months.
  • The APPG heard that this was an important issue for industry that could undermine growth in the UK and ultimately the Government’s vision for the UK to become a global cryptoasset hub.

Financial Promotions:

  • The APPG also heard views in relation to the UK’s new financial promotions regime which was welcomed as an important step in terms of consumer protection but had also caused complications for some crypto and digital firms.
  •  The APPG heard that industry recognised and supported the overall aims of this new regime which would ultimately protect consumers and promote competition, but that in terms of implementation Government and regulators should ensure that rules were proportionate and balanced.
  • The APPG heard that Government and regulators should ensure that there remains a level playing field and that UK firms are not being left at a disadvantage to overseas firms or indeed that we are not inadvertently causing firms to leave the UK.

Exchange-Traded Funds (ETFs):

  • The APPG also heard views in relation to Exchange-Traded Funds (ETFs) following the US Securities and Exchange Commission recent approval of the first spot bitcoin exchange-traded funds.

  • The APPG heard that there was strong support for a similar approach in the UK and that many believed that there was scope to ensure high standards of consumer protection in the sector whilst also encouraging innovation in relation to new products and services.

Next Steps:

  • Lisa Cameron MP said that the APPG would continue to look at all of the issues raised and would continue to raise these with Government where necessary.
  • Lisa Cameron MP said that the APPG remained open to hearing from any and all stakeholders in relation to their views on crypto and digital asset regulation and encouraged people to continue to participate in the APPG’s work and to raise issues the APPG should be aware of.
  • Lisa said that any issues raised with the APPG would be considered by APPG officers and may form the basis of the APPG’s scrutiny work in the future .

Meeting Close:

The chair thanked everyone for their contributions to the discussion and brought the meeting to a close. The meeting lasted approximately 90 minutes and no further business was discussed.