The UK government has officially ruled out holding Bitcoin or any other cryptocurrency in its sovereign reserves, distancing itself from recent policy shifts in the United States. Speaking at the Financial Times Digital Asset Summit in London, Economic Secretary to the Treasury Emma Reynolds MP made the government’s stance clear: a national crypto reserve is not under consideration.
“We don’t think that’s appropriate for our market,” Reynolds stated.
While acknowledging the trend of U.S. states exploring Bitcoin reserves and federal discussions around a strategic digital asset stockpile, Reynolds emphasized that Britain’s priority remains financial stability and regulatory clarity. Instead of accumulating volatile assets, the UK is opting for a cooperative international policy framework—especially with the United States.
She confirmed that UK Chancellor Jeremy Hunt and U.S. Treasury Secretary Scott Bessent have already begun high-level consultations on digital asset regulation. These talks have now formalized into a senior-level UK–U.S. working group focused on crypto and digital finance policy, expected to meet for the first time in June 2025.
UK Explores Blockchain for Debt Issuance—Not Reserves
Though it has ruled out speculative crypto holdings, the UK government is actively evaluating blockchain technology for sovereign finance infrastructure. Reynolds revealed that distributed ledger technology (DLT) is being considered as a base layer for issuing government bonds.
Procurement is already underway, with a provider expected to be selected by late summer. This move could represent a paradigm shift in how the UK issues sovereign debt, prioritizing transparency and efficiency through digital infrastructure—while avoiding the volatility associated with crypto reserves.
In her remarks, Reynolds also highlighted the UK’s differentiated approach compared to both the EU and U.S. While regulatory cooperation with the U.S. is growing, the UK will not adopt the EU’s MiCA framework, preferring a principles-based system over the EU’s rules-heavy model. This flexibility is designed to support innovation while still ensuring investor protection and market integrity.
Principles-Based Regulation Meets Decentralization Headwinds
The UK’s crypto strategy revolves around a “same risk, same rules” principle. In other words, if a digital asset or activity poses the same risks as a traditional financial product, it should face the same regulatory expectations.
“Essentially we’re saying, ‘Same risk, same regulatory approach,’” Reynolds noted.
However, she acknowledged that decentralized technologies like Bitcoin pose unique challenges. Without a central issuer or governance structure, traditional regulatory mechanisms often fail to apply. While the UK intends to bring centralized crypto actors under its financial services regime, fully decentralized protocols may remain largely outside regulatory reach.
“There’s only so much the government can do in that regard,” she added, admitting that some aspects of crypto remain “amorphous” and inherently difficult to supervise.
Quick Facts
- The UK Treasury has ruled out creating a national crypto reserve, citing financial stability concerns.
- Instead, the country is exploring blockchain for sovereign debt issuance and digital infrastructure modernization.
- The UK is deepening its regulatory coordination with the U.S., forming a joint crypto policy working group set to meet in June.
- UK officials emphasize a “same risk, same rules” regulatory model but acknowledge the limits of controlling decentralized networks like Bitcoin.
