Britain wants to take the U.S. on as a global crypto hub — but the industry has its doubts

LONDON — Britain is making a fresh pitch to become a global crypto hub, but faces a tough road ahead amid criticism from local entrepreneurs and U.S. competition under President-elect Donald Trump.

Britain's Labour government has committed to making the country an accommodative environment for businesses engaged in crypto and blockchain-related activities.

In a recent speech, U.K. Economic Secretary to the Treasury Tulip Siddiq said the government aims to engage firms on draft legal provisions for digital assets including stablecoins — tokens pegged to the value of sovereign currencies — "as early as possible next year."

She also said the government wouldn't approach crypto staking services, which offer rewards on users' token holdings, as collective investment schemes. Crypto industry insiders had worried such a treatment would have created burdensome regulatory requirements.

"This is a sector with enormous potential and a sector that's already playing a central role in the U.K.'s vibrant tech landscape," Poppy Gustafsson, Britain's investment minister, said last week at an event organized by the U.K. division of Coinbase-backed advocacy group Stand With Crypto.

Gustafsson said the government is "committed to fostering and embracing blockchain" and is "already taking decisive steps to support this sector and ensure that we remain at the forefront of this global innovation."

One example she cited was the launch of the Digital Securities Sandbox, a testbed for developing new distributed ledger technology-based solutions for the issuance, trading and settlement of securities in a live regulated environment.

Another example is the "digital gilt" pilot launched last month, which looks to issue U.K. government bonds on the