Crypto is not a curiosity or a fad, it’s set to transform financial services – and as with any true innovation we must be prepared to experiment and sometimes fail, says Lord Ranger

The soaring office towers of Canary Wharf stand as testimony to Britain’s golden era of smart regulation and financial ingenuity, cementing London’s long tradition as the world’s financial capital. 

Today, many of those offices are, tellingly, being converted into flats while futuristic skyscrapers rise overseas, most notably in the UAE, signalling a shift in the centre of global finance.

After revised economic figures signalled the UK teetering on the edge of recession, Economic Secretary to the Treasury Darren Jones insisted the government’s “absolute focus” for 2025 remains on driving growth.

The new government cannot afford to overlook the City, long the engine of Britain’s economy. Labour’s focus on energy and planning reform is commendable, but the rise of digital finance —cryptocurrencies, tokenisation, and beyond — demands attention. And fast. 

The Financial Conduct Authority’s (FCA) “Crypto Roadmap” marks the first quarter of next year as critical for crypto’s future in the UK. Key regulations on trading platforms, order handling, lending, and prudential rules are all set to be announced.

At the same time, initiatives like Digital gilts roadmap, the Bank of England’s Digital Securities Sandbox and the UK’s Central Bank Digital Currency (CBDC) are promising developments. Yet, consultation on the CBDC began in 2021 and has since seen minimal progress.

Safety vs speed

I am concerned that, as with most frontier technology, the language of regulators and the posture of politicians this year has been overly focused on “safety” rather than speed, innovation, and, yes, risk. True innovation — like that of the 1980s — requires a willingness to experiment, even if it sometimes leads to failure. Often, this means less regulation, not more.

Historically, the City’s success rested on three pillars: a robust legal framework, its strategic geographic and time-zone advantages, and a culture that celebrated innovation and rewarded success.

However, in the wake of the 2008 financial crisis and the long shadow it cast, we have become overly risk-averse. A well-placed desire to avoid the errors of the past is blunting our ability to innovate at pace and keep up with competitors.

We now stand on the brink of a new paradigm in financial services — one driven by blockchain, artificial intelligence (AI), and digital currencies. The UK is still well-positioned to capitalise on this shift and maintain its hard-earned position of global leadership. But will our reluctance to embrace risk and change hold us back?