New chancellor Rachel Reeves showed openness to the tech sector while in opposition, and has declared growth as the UK’s “national mission” after the Labour landslide.
In the last stages of their 14-year tenure, the Conservatives displayed a generally positive attitude to crypto, and in November 2023, the plans for regulating stablecoins were outlined as part of a comprehensive cryptoasset regulatory regime. Former Prime Minister Rishi Sunak pledged to make the UK a global hub for cryptoasset technology and investment.
While the Labour Party has not yet taken definitive positions on crypto-related technology such as blockchain, its plan for financial services issued in January hinted at a progressive approach, “embracing securities tokenisation and a central bank digital currency” as part of its vision for the UK.
“For Starmer and Labour, the strategic imperative is clear. By positioning the UK as a global leader in cryptocurrency, they can drive economic growth, create jobs, and nurture innovation.”
Nigel Green, CEO, deVere Group
“A well-defined regulatory environment will provide clarity and security to businesses and investors. By working closely with industry leaders and stakeholders, a Labour government can ensure that regulations are balanced, fostering innovation while safeguarding the financial system,” Nigel Green, CEO, deVere Group, says.
“For Starmer and Labour, the strategic imperative is clear. By positioning the UK as a global leader in cryptocurrency, they can drive economic growth, create jobs, and nurture innovation. The potential benefits extend beyond the crypto sector, enhancing the UK’s overall financial ecosystem and cementing its role as a forward-thinking, dynamic economy.”
Crypto price rebound after Mt. Gox repayments
Bitcoin dipped to its lowest point since February as Mt. Gox’s trustees transferred its first repayments to crypto exchange Bitbank on Friday morning.
Mt. Gox began repaying its creditors as part of its legal and ethical obligations following its collapse in 2014. The company will reportedly make a $9 billion payout.
Investors’ main concern was that creditors receiving Bitcoin might sell their holdings, leading to increased supply and downward pressure on prices.
“There are endless applications that solve major problems our planet is facing. We needed this correction. It’s a healthy part of the cycle, which will prepare the market for the next phase.”
Tim Kravchunovsky, Founder & CEO, Chirp
The repayment process has been complex and lengthy, involving numerous legal and administrative steps.
The sell-off represents a chance to clear the runway for quality tokens, Tim Kravchunovsky, Founder & CEO, Chirp, said. “We can [now] expect to see a reallocation of capital away from get-rich-quick schemes and scams, that offer short-term gains at best, toward projects that are delivering real value.
“We need more of this kind of development in areas like agriculture, sustainability, Smart City development. There are endless applications that solve major problems our planet is facing. We needed this correction. It’s a healthy part of the cycle, which will prepare the market for the next phase.”
German government sell-off
A major cryptoasset selloff by the German government also contributed to the bull run.
According to blockchain analysis company Arkham Intelligence, Germany moved 1300 bitcoins – worth approximately $76m- to exchanges on June 19, contributing to a roughly 15% price decline.
Germany still holds $2.2 billion of its original $3 billion holdings, according to CoinDesk.
The moves were part of a general price decline across June, following a price doubling that started in January after the SEC’s approval of bitcoin ETFs.
The market recovered somewhat on Monday, with prices rising as reports emerged of a German government buyback of at least $100m worth of bitcoin, but some crypto-watchers speculated this could be fake news.
