UK Slams Door on Crypto: New Licensing Law Bans Bitcoin, Staking, and Exchanges Effective Immediately
London’s financial regulators just dropped a hammer on crypto—no warning, no grandfather clauses. As of today, trading Bitcoin, operating exchanges, or even staking tokens without FSA approval lands you in illegal territory.
The move blindsided traders who woke up to frozen accounts and panicked sell-offs. ‘Innovation-friendly’ rhetoric? Gone. The FSA’s stance is clear: fall in line or get out.
Meanwhile, traditional banks are already spinning this as ‘investor protection’—conveniently ignoring their own 2008 playbook. Crypto’s response? A collective eye-roll and VPN signups.
New UK Crypto Bill Stirs Controversy
The UK just drafted new crypto regulation.
"If the FCA considers […] a person has acted […] contrary to the advancement of its objectives […] the FCA may publish a statement to that effect."
The FCA just gave itself the right to publicly shame you WITHOUT TRIAL if it doesn’t… pic.twitter.com/aA8OG1JOxV
— Crypto Tips (@cryptotipsreal) April 29, 2025
The proposed new legislation contains several controversial points, which are already causing a grumble from crypto entities.
- Staking Dragnet: Even minimal staking operations could trigger full regulation, potentially kneecapping DeFi in Britain.
- Stablecoin Backing: Any fiat-referenced coin must follow heavy “backing asset” disclosure rules, which can be a potential nightmare for algorithmic and hybrid models.
- Innovation Freeze Warning: Smaller crypto startups may abandon the UK market rather than navigate a mountain of compliance hurdles.
Despite a change in political leadership with Labour replacing the Conservatives, the new government has committed to completing the previous regime’s “crypto asset regime” plans almost in full, with no new position or reconsideration.
Why It Matters: This isn’t just another boring regulatory update – it’s the start of the UK’s attempt to dominate “Regulated Crypto” globally. However, by locking the industry into the old financial rules, Britain may also accidentally smother the Web3 revolution it hopes to host.
Overall, the UK’s crypto crackdown is a double-edged sword, offering legitimacy on one hand and a regulatory chokehold on the other. Crypto firms worldwide are now on notice: adapt, comply, or leave Britain.
