At the recent Crypto Industry Parliamentary Summit held at the House of Lords co-hosted by CryptoUK and Lord Ed Vaizey, I joined Parliamentarians and senior industry figures to explore the UK’s path toward crypto regulation.

The UK has long been known for its high-quality legislation and rigorous standards designed to protect consumers but, as I shared in my opening remarks, for regulators tasked with managing risk in a fast-moving space like crypto, it’s no easy feat.

The UK wants to be a crypto hub but we’re not there yet

The UK government has been vocal about its ambition to position the country as a global centre for crypto and digital asset innovation. Chancellor Rachel Reeves announced during IFGS that the Government will “back its builders” but many are being held back by regulatory ambiguity, delays and disconnects.

What the summit revealed about UK crypto regulation and growth

Across the room, we heard consistent themes:

• Firms reported application timelines as long as 700 days
• The FCA’s authorisation process is often opaque and rigid, with a high rejection rate
• Minor, fixable issues can derail entire applications
• Regulatory bodies remain under-resourced and outpaced by crypto’s speed.

Crypto asset firms are facing numerous challenges when implementing strategic plans for growth within the UK. In the FCA’s latest annual report, over 87% of crypto registrations were rejected, withdrawn or refused.

The demanding and competitive business environment is further stressed by the increasing cost of compliance, the difficulty in adapting to rapidly changing regulations, and a lack of clear regulatory timelines and expectations. These factors contribute to the struggle for businesses to remain viable in an already crowded market, where those with limited resources face an even greater risk of failure.

You can’t regulate what you don’t understand

Progress depends on shared understanding. That means the responsibility doesn’t lie solely with policymakers, it needs to work both ways.

For the UK to become a crypto hub, regulators need transparent insights into crypto operations, while the industry requires clear, reliable guidelines. Education, evidence-based approaches, and well-defined pathways are crucial for fostering this mutual trust and understanding.

If we want change, we need to be part of building it by bringing solutions, not just problems, to the table.

Local infrastructure matters

Now more than ever we need localised expertise and infrastructure to serve the particular needs of the UK consumer and the UK market. Without it, the benefit of cryptoasset-derived growth is likely to accrue to large international players.

If the UK is serious about keeping cryptoasset-derived growth onshore, it needs the right foundations in place.

That means:

• Local infrastructure built to UK standards
• Expert partners who understand the UK regulatory mindset
• Policy frameworks that support long-term adoption and integration

Without this, the UK risks handing over market value and its reputation as a financial leader to more agile jurisdictions.

For businesses entering the UK crypto market, here’s what to expect:

If you’re planning to launch or scale your crypto business in the UK, here’s what you should be prepared for:

• Regulatory timelines are extensive: Businesses should prepare for a lengthy approval process. FCA applications can take over 18-24 months, with high rejection rates and low tolerance for incomplete or unclear applications. Strategic planning must account for these timelines from the outset.
• Compliance is foundational, not optional: Operating in the UK requires a deep integration of compliance practices. This includes clear handling of AML, consumer protection, and financial promotions. Regulatory expectations are evolving, and increasingly detailed. Success depends on understanding and anticipating these shifts.
• Local context is critical: The UK’s regulatory environment is shaped by its own institutions, history and market expectations. Approaches that work elsewhere may not translate. Businesses need to understand UK-specific frameworks, terminology, and institutional dynamics to operate effectively.

How can we remove roadblocks from the UK’s roadmap?

The point of having a rigorous framework as now proposed is that it gives the foundations to empower the longer-term view of adoption of both cryptoassets and blockchain technology by ‘main street’ business. That means payment firms, banks and financial services firms being able to seamlessly add on digital asset services leveraging trusted and regulated infrastructure.

As one of the few UK-founded, FCA-registered infrastructure providers, our mission is to leverage our expertise to support navigating this environment. The summit made it clear: there’s momentum, but we need to convert it into practical, scalable progress together.

The UK doesn’t need to start from scratch. The building blocks are already here.

Under the UK’s future crypto regime, offering crypto services in the UK will require full authorisation, not just AML registration. It’s a shift that will change the market and businesses that start preparing now will have the advantage.

Whether you’re a regulator seeking input, or a crypto business planning your next move, we’re here to help bridge the gap with infrastructure, insight and regulatory experience built in the UK, for the UK.

Contact us to understand how Zumo can support your UK operations roadmap.