Reform's UK Crypto Plan: What You Need to Know

In this Institute of Economic Affairs Briefing, Communications Manager Reem Ibrahim interviews Jamie Legg, Digital Productions Manager, to discuss Reform UK's newly announced Crypto Asset and Digital Finance Bill. The conversation explores the fundamentals of cryptocurrency and Bitcoin as decentralised digital assets, examining how they differ from traditional fiat currencies issued by central banks. Legg explains how cryptocurrency aligns with classical liberal economic principles through its anti-central bank nature and market-driven approach to money, positioning it as a potential evolution of finance similar to how the internet transformed other industries.

The discussion delves into Reform UK's specific policy proposals, which include reducing capital gains tax on crypto from 24% to 10%, establishing a two-year regulatory sandbox with the FCA and Treasury, implementing banking non-discrimination duties, creating a sovereign Bitcoin reserve fund, and allowing tax payments in cryptocurrency. Legg provides analysis of how the UK currently ranks in the middle of global crypto regulatory frameworks, noting that while not awful, there remains a lack of clear guidance particularly around NFTs and decentralised finance. The conversation examines the competitive landscape, comparing the UK's position to the EU's comprehensive regulations and noting the potential post-Brexit opportunities for regulatory divergence.

The interview concludes with comparisons to international developments, particularly the improved regulatory environment in the US under the Trump administration with David Sacks overseeing crypto legislation, and the establishment of strategic Bitcoin reserves at both federal and state levels. Legg discusses what an ideal regulatory framework would look like, emphasising the need for clarity rather than heavy-handed regulation, and noting the political significance of crypto adoption among younger demographics. The conversation highlights the growing global recognition of cryptocurrency as a legitimate financial sector and the importance of maintaining UK competitiveness in this emerging market.

Watch the full episode here, or wherever you get your podcasts.