Gemini exits UK, raising doubts over crypto hub push and rules
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Gemini’s plan to exit the United Kingdom, European Union and Australia to concentrate on the United States and Singapore has intensified scrutiny of whether the UK’s still-evolving regulatory framework is discouraging even well-regulated firms the government aims to attract. For details, you can read about it on this Gemini post.
In April 2022, then Chancellor Rishi Sunak outlined an ambition to establish the UK as a “global hub for cryptoasset technology,” unveiling Treasury initiatives including stablecoin oversight and launching the Financial Conduct Authority’s (FCA) “CryptoSprint” to support investment in the sector.
In a Feb. 5 strategy update, Gemini said many overseas markets were “hard to win,” adding that prior expansion left the company “stretched thin” with added organizational complexity and higher costs.
Gemini strategy update: Source Gemini
Why Gemini’s withdrawal matters for UK policymakers
Susie Violet Ward, CEO of Bitcoin Policy UK, said protracted rulemaking, overlapping requirements and elevated compliance costs relative to market size are deterring firms from building in the country, even as the FCA advances toward a (MiCA)-style prudential regime for cryptoasset businesses. Ward noted that when rules are in flux and compliance is costly compared to the opportunity, firms are less likely to commit capital, hire, and scale, adding that capital tends to flow to jurisdictions offering clarity and certainty.
Ward added that UK crypto companies currently navigate a “patchwork” of Anti-Money Laundering (AML) registration, financial promotions restrictions and interim guidance while a comprehensive regime remains “years away,” making it more difficult to deploy capital than in jurisdictions with clearer frameworks.
Points of friction in the UK framework
Laura Navaratnam, head of UK policy at the Crypto Council for Innovation, said Gemini’s decision—coming from one of the first firms to receive FCA registration in 2020—will be “a blow for policymakers” seeking to finalize the regime ahead of license applications opening in September.
Under draft proposals, UK-facing crypto firms will need to apply for full FCA authorization during a five-month gateway window from Sept. 30, 2026, to Feb. 28, 2027, with the new prudential regime scheduled to take effect in October 2027. Navaratnam said key elements remain unresolved, particularly how the FCA’s stablecoin rules interact with the Bank of England’s systemic regime, warning that differing approaches could create a “cliff edge” during transitions and trigger further withdrawals if not addressed.
CoinJar crypto exchange CEO Asher Tan said the UK’s move from a narrow AML-registration approach to full Financial Services and Markets Act (FSMA) authorization is “materially raising the operational lift” for exchanges serving local users.
Ward said the UK is not striking the right balance by failing to clearly distinguish Bitcoin (BTC) from other cryptoassets and by not providing timely, actionable guidance. She said surveys of UK crypto firms indicate bank account closures and refusals are common, increasing the likelihood of businesses relocating.
FCA’s next steps and industry outlook
Industry retrenchment is not unique to the UK. Large players such as Coinbase have withdrawn from certain markets, including Argentina, when local conditions and strategic priorities did not justify continued operations.
The FCA is consulting on CP25/42, a proposed prudential regime that would extend rules to crypto trading platforms, staking and dealing activities, embedding capital and liquidity requirements across the sector as part of a broader package of consultations that closes on Thursday.
A new regime for cryptoasset regulation. Source: FCA
The new regime is expected to take effect on Oct. 25, 2027, following the authorization gateway.
Tan said the direction of travel is clear: firms intending to stay in the UK will need to allocate significant resources to meet the coming standards, and many are weighing those costs against the market opportunity.
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