The unexpected landslide victory of the Partito Laburista has led Keir Starmer to assume the role of Prime Minister of the United Kingdom (UK), but what does all this have to do with crypto?
Despite not mentioning the cryptocurrency industry during the election campaign and in the party’s manifesto, the new Labour government has declared that it intends to support tokenization and the development of a central bank digital currency.
This announcement has caught many observers by surprise and could mark a significant change in the economic and financial policy of the United Kingdom. Let’s see all the details below.
Summary
Undeclared crypto plans: what happens after the victory of the Labour Party in the UK?
As anticipated, the Labour Party has triumphed in the United Kingdom’s general elections on Thursday, securing a landslide victory that ends 14 years of Conservative rule.
Keir Starmer will become the new Prime Minister, but his legislative program leaves many uncertainties about the regulation of cryptocurrencies.
The Labour Party has abundantly surpassed the threshold of 326 seats necessary to obtain the majority, with the BBC reporting 410 seats won at 8:30 British Summer Time (7:30 UTC) on Friday.
On the contrary, the conservatives, known as Tories, stopped at 119 seats. Both parties did not mention the cryptocurrency industry in their electoral manifestos. Instead, they focused on topics such as the economy, the police, and the National Health Service.
During the long period in government, the position of the conservatives on cryptocurrencies was clear. The party aspired to make the United Kingdom a hub for cryptocurrencies.
Specifically by enacting laws that treat cryptocurrencies as regulated activities and consulting on future plans, including rules on stablecoin.
Bim Afolami, Secretary of the Economy under former Prime Minister Rishi Sunak, had attended many fintech conferences, promising secondary legislation for stablecoin.
The Labour Party, instead, has declared that it will support the Bank of England’s plans for the digital pound.
The decision on the issuance of the central bank digital currency (CBDC) is expected for 2025-2026, pending legislative approval by Parliament.
The end of conservative dominance: what will be the future of crypto?
The BBC has predicted that the Labour Party could end the evening with 410 seats, compared to the 144 of the Conservatives. In a victory speech, Starmer stated the following:
“The change starts now.”
He also emphasized how the four and a half years of work to transform the party have led to this result, declaring that the Labour Party is ready to serve the country and bring Britain back to serving the workers.
Former Prime Minister Sunak acknowledged the defeat, congratulating Starmer in a concession speech:
“The British people have delivered a verdict that gives pause for thought tonight.”
In January, the Labour Party had published a plan for financial services that included the creation of a hub for the tokenization of securities, with the aim of clarifying the law on tokenization.
The tokenizzazione consists in the digital representation of financial and other types of assets on the blockchain.
Members of the crypto community have expressed optimism before the elections, suggesting that the labor party could do more in terms of regulation, building on the work already started by the previous government.
Jordan Wain, head of British policy at Chainalysis, emphasized that much of the crucial work has been carried out by government departments and the FCA (Financial Conduct Authority), and it will not be abandoned with the change of government.
The Labour victory represents a moment of change for the United Kingdom, and the cryptocurrency industry awaits with interest the next moves of the new government of Keir Starmer.
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