As the U.K. looks to position itself as a pro-crypto region alongside the EU and the U.S., it is putting its focus on smoothening the relationship between banks and crypto players. In a fresh development, a cross-party parliamentary group has decided to investigate the current status of banking-crypto situation and identify the major barriers. The development comes just weeks after the Financial Conduct Authority (FCA) published U.K.’s finalized crypto regulations.
The Crypto and Digital Assets All-Party Parliamentary Group (APPG) will now assess how crypto companies can have an open access to banking support in the U.K..
What entails
For years, traditional banks around the world including in the U.K. have resisted engaging with the crypto sector owing to the lack of regulations and the risk of volatility.
Presently, British banks UK banks reportedly delay or fail about 40 percent of all domestic crypto-related transactions. While financial players like Chase UK, Virgin Money, and Metro Bank prohibit crypto purchases, others like HSBC and NatWestlevy strict daily caps to major exchanges, or block transfers.
First set up in 2022, the APPG actually became active in the U.K. in July 2025. In the last one year, the committee found out that obstructed banking access was among the most significant challenges pulling back crypto firms from operational expansions.
“As the UK prepares to implement its new crypto regulatory framework, the APPG is seeking evidence to better understand whether crypto and digital asset businesses continue to face barriers when accessing banking services, and whether further action may be needed,” the official announcement from the APPG said.
Lord Vaizey of Didcot, a former digital economy minister, and Labour MP Gurinder Singh Josan serve as co-chairs of the APPG. They wish to conduct a thorough study on the degree of impact that digital assets can have on U.K.’s existing financial ecosystem and the best practices that can be adopted to make the most of this financial upgrade while ensuring national safety.
The U.K. government opening this probe indicates that in the coming months, the U.K. could bring more clarity to provisions like insurances for crypto accounts and transfer limits.
The APPG has asked banks, payment service providers, crypto and digital asset businesses, regulators, trade associations, consumer groups and other interested stakeholders to contribute with data and insights to the inquiry.
“The call for evidence is now open and closes on 31 August 2026. If your organisation has relevant evidence or experience to share, the APPG encourages you to contribute and help inform its findings and recommendations,” the announcement noted.
U.K.’s crypto laws
On June 30, the FCA published U.K.’s crypto laws with the aim of holding crypto firms as accountable as traditional finance players in Britain.
“Firms supporting people to buy, trade and hold cryptoassets will need to meet clear standards under our new rules and get ready for when they come into effect in October 2027,” the FCA said.
These rules are set to go into effect in October 2027 so crypto firms in the nation now have over a year to bring their operations in alignment with these regulations.
U.K.’s HM Revenue & Customs (HMRC) also recently announced new rules to treat certain crypto lending and liquidity pool transactions as “no gain, no loss”. Effective from April 2027, DeFi users in the U.K. will generally not be liable for Capital Gains Tax (CGT) when moving eligible crypto assets into lending protocols or DeFi liquidity pools.
Regulatory clarity is set to attract more international crypto players to the U.K. in the coming years. The FCA is overseeing the licensing formalities for crypto players there.
Kraken, Mastercard, Aave Labs are among crypto players expanding their U.K. presence.
