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The UK government is set to introduce a comprehensive regulatory framework for the crypto sector in early 2025, as part of its efforts to keep pace with developments in the United States and Europe. 

Bloomberg reported that Economic Secretary to the Treasury, Tulip Siddiq, announced that the government will draft new rules for crypto assets, including stablecoins and staking services, under a single overarching regime.

Speaking at a conference in London on Thursday, Siddiq outlined the government’s plans to introduce a unified regulatory framework for cryptocurrencies and related services. 

The introduction of rules on stablecoins, which are cryptocurrencies pegged to stable assets like the US dollar, and staking services, was initially expected under the previous Conservative government. However, the timetable was delayed due to the general election. With the Labour Party now in power following their victory in July, the government plans to address these areas in a single legislative phase.

Stablecoins, according to the new framework, will no longer be covered by the UK’s existing payments services regulation. Siddiq explained that this shift is necessary because stablecoins have different use cases that do not align with traditional payment service models.

In addition to stablecoins, the new regulations will also address staking services. These services, where investors lock up tokens to support a blockchain network in exchange for a yield, have been uncertain about whether they should be classified as collective investment schemes, which would bring additional regulatory oversight.

Siddiq confirmed that the government intends to remove this legal ambiguity, recognizing staking as a technological service rather than an investment scheme.

The UK’s regulatory efforts come amid growing competition in the crypto space.

With the European Union set to implement its Markets in Cryptoassets (MiCA) regulation by the end of the year, and the US market gaining attention under the leadership of President-elect Donald Trump, the UK is under pressure to provide clarity to crypto businesses.