Working Together or Own Country First: Digital Finance Regulators Talk Future at London Conference

Working together is the ambition...

Speaking at the City & Financial Future of Digital Assets Summit in London on 19 May, the chair of the US Commodities Futures Trading Commission, Michael Selig (pictured), said: "We very much hope to all work together to set the standard."

"We want to make sure this new technology, that is truly global technology, is going to work for everyone, across borders. It has to be a group effort," he said.  "Ideally, across borders we’ll be harmonized because it’s going to be very difficult to do a cross-border transaction if one country is applying completely lop-sided rules and regulations and standards."

Sarah Breeden, deputy governor of the Bank of England, agreed that "effective coordination is critical."

Much of the discussion was driven by the cross‑border nature of digital assets. Navigating global tax regulations, for example, has the potential to add significant friction. One of the key questions is about the localization of profits, and therefore tax liabilities. Several speakers also addressed the need for clear and consistent Know Your Customer (KYC) and Anti-Money Laundering regulations, alongside measures to protect market integrity.

... but competition isn't dead

But for all the consensus, competition also reared its ugly head. Selig said one of his key aims is to make sure "the US is the best place in the world to do business [...] as much as we like London." 

Selig, a longstanding champion of US leadership in digital finance regulation, is also at the forefront of the Trump administration's efforts to manage crypto markets through legislation rather than enforcement only, making the US environment what he regards as the industry's "gold standard" for global crypto.

Chris Hayward, policy chair at the City of London Corporation, insisted that "we are accelerating our long-term efforts to secure London’s primacy in this new frontier." He said the UK financial hub leads the world, ahead of New York, Hong Kong, Tokyo, Singapore, Frankfurt and Paris. That, he said, is "cause for celebration, but not for complacency," adding that London needs to work hard on innovation and the ecosystem to support it. 

"This is unequivocally a race and a race that we must win. To be competitive tomorrow, we must act fast on digital assets," Hayward said.

Need for transparent rules

There was broad agreement that any shift towards tokenized markets is a fundamental one that needs to be managed carefully. Rules must be transparent and offer certainty, several speakers said.

Crucially, that should involve close cooperation with the industry to support private‑sector investment and development. Ben Santos‑Stephens, CEO of ClearToken, said progress has to involve "systematic, methodical change."

Pressure for speed

Not all stakeholders agree. At a meeting in the House of Lords on 15 May, organized by the Digital Assets Global Forum, some in the sector argued that the UK needs to move faster and provide clearer direction. 

Lisa Cameron, a former Conservative lawmaker who heads the organization, said firms want to understand how to operate within the rules. Talking to Sandmark after the meeting, she said, "Companies say they want to be able to know that they are acting within the regulatory guidance and there doesn't seem to be enough clarity in UK generally on what this is."

"There seems to be uncertainty about where the Government is heading and the vision for the sector, which is limiting the potential and impact of current growth," she added.

James Bowater, CEO of the Digital Commonwealth, took a more direct view. He told Sandmark that "there is no plan" and that the UK needs to stop consultations and "get on with it". Reform UK, the far-right party of Nigel Farage, has a "clear and audacious view of the digital asset world," he said. Reform UK’s proposals, which seek to prioritize growth and innovation over precaution, include reducing taxes on crypto transactions and starting a Bank of England Bitcoin reserve.