Britain’s Crypto Gridlock: A Missed Opportunity in a Rapidly Moving Financial World

By Trevor Johnson

“This overreach from banks is only possible because there’s still no clear UK regulatory framework in place governing crypto.” — Michael Healy, UK Managing Director at IG

An Increasingly Difficult Task: Moving Money in Modern Britain

For everyday investors in the UK, moving money into crypto has become a confusing and often frustrating experience. A significant number of consumers report encountering delays or outright rejections when attempting to transfer funds to digital asset platforms. In fact, a recent survey by IG and Norstat found that nearly 40% of UK crypto investors had at least one payment blocked or held by their bank in August 2025 alone.

This isn’t a temporary glitch—it’s been the status quo since restrictions began in 2021. Some banks, like Chase UK and Starling, still enforce blanket bans on crypto transactions. Others, such as HSBC and NatWest, limit engagement through caps on transfer amounts, while Barclays disallows credit card purchases entirely. Though these limitations are typically justified as fraud prevention, the practical result for consumers is a system in which accessing digital assets feels unpredictable and constrained.

Banking decisions in the UK are increasingly driven not by fees or service quality, but by whether an institution will even allow participation in the evolving digital economy. And while British users navigate these hurdles, other parts of the world are moving forward.

Elsewhere, Progress Through Policy

In the European Union, the landscape looks markedly different. The rollout of the Markets in Crypto-Assets (MiCA) regulation in late 2024 created a unified regulatory framework across the bloc. This has allowed banks such as SolarisBank in Germany and SEBA in Switzerland to offer crypto-related services confidently, including custody, staking, and fiat-to-crypto conversion. Crucially, MiCA enables licensed entities to operate across all EU member states, making it easier to scale services and compete across borders.

The United States has also begun to shift course. The GENIUS Act, signed into law in July 2025, formally brought regulated stablecoins into the banking system. This has encouraged some of the largest financial institutions—including JPMorgan and Charles Schwab—to explore blockchain-based custody and payment infrastructure. While U.S. policy remains cautious, it now signals a willingness to embrace innovation under structured oversight.

And then there’s Africa, where crypto adoption is being shaped by utility rather than speculation. In Nigeria, one of the world’s largest peer-to-peer markets, digital currencies are helping reduce the cost of remittances and offering a store of value in an unstable fiat environment. South Africa has issued licenses to nearly 250 crypto service providers. Ghana is actively piloting the e-Cedi, a digital national currency. In Mauritius, an early licensing regime has helped establish credibility and attract investment.

On the ground, grassroots projects in cities like Nairobi are enabling residents in underserved areas to transact using crypto where traditional banking has never reached. In many of these regions, crypto is not a future bet—it’s a present-day necessity, integrated into how people send money, run businesses, and preserve their savings.

From Leading the Charge to Losing Momentum

Just a few years ago, the UK was positioning itself to lead this shift. In 2022, then–Chancellor Rishi Sunak declared a national ambition to make Britain a “global hub for crypto-asset technology.” At the time, adoption was accelerating—rising from just 4% of adults owning crypto in 2021 to over 12% by 2024, according to the Financial Conduct Authority.

But while the vision was ambitious, execution lagged behind. Draft regulations entered extended consultation phases. Parliamentary momentum stalled. And as other jurisdictions moved forward with concrete rules, Britain remained in limbo. Former Chancellor George Osborne summed up the frustration: “Far from being an early adopter, we have allowed ourselves to be left behind.”

Britain’s Broader Economic and Political Landscape

Today, the UK’s economic backdrop is one of cautious stability, rather than confidence. Inflation has cooled but remains a concern in specific sectors. GDP growth is flat, and consumer spending has been sluggish in the face of high living costs and tight credit conditions. Interest rates remain elevated as the Bank of England hesitates to move too quickly on cuts, wary of reigniting inflationary pressures.

Politically, the recent general election brought in new leadership amid widespread calls for renewal and reform. But deep structural issues persist—Brexit-related trade frictions, weak productivity, and a lack of investment in emerging industries. In this environment, digital finance could represent a strategic lever for growth and competitiveness, but it requires a clearer regulatory roadmap to be effective.

The Risk of Drifting Further Behind

Meanwhile, the pace of global innovation continues to accelerate. As Europe, the U.S., and parts of Africa expand their frameworks and experiment with new models, the UK risks ceding influence—not because it lacks capacity, but because its institutions have yet to fully align on a forward-looking strategy.

Within the current vacuum, much of the decision-making power rests with banks. And in the absence of defined policy, their response has been conservative. Understandably so: without clear rules, the perceived risk outweighs the reward. But this status quo leaves consumers navigating uncertainty, and it limits opportunities for domestic companies building in the digital asset space.

Each blocked transaction or hesitant policy sends a signal—not just to investors, but to the global market—about the UK’s role in the financial future. The longer the ambiguity persists, the harder it may be to regain momentum.

Looking Ahead

The conversation around crypto regulation is not just about technology. It reflects broader questions of inclusion, resilience, and competitiveness. Different countries are answering those questions in different ways, but the trend is undeniable: digital assets are becoming part of the financial mainstream.

For the UK, the challenge now is not to lead for the sake of leadership, but to ensure that its regulatory approach supports innovation while maintaining stability. Striking that balance will require collaboration between policymakers, regulators, banks, and the public.

As other regions move ahead with purpose, the UK’s decisions in the coming months will shape not only its position in the digital economy—but also the experience of millions of its citizens who are eager to engage with it.