Pro-Crypto UK Minister Tulip Siddiq Resigns: What’s Next for Digital Assets in Britain?

• Tulip Siddiq has resigned following allegations of illegal ties to an anti-corruption investigation in Bangladesh.
• The resignation of the pro-crypto minister raises questions over the future of digital asset regulations in Britain.
• In November, research from the FCA found that 12% of U.K. adults now own crypto.

U.K. Treasury Minister Tulip Siddiq, a vocal crypto advocate, has announced her resignation after facing mounting pressure over an anti-corruption investigation in Bangladesh.

As a vocal part of the government for crypto, Siddiq’s resignation has raised questions over the potential future of digital assets and their regulation in the country.

The resignation comes at a pivotal time for the industry; with President-elect Donald Trump taking office on Jan. 20, the U.S. is likely gearing up for a renewed wave of innovation in digital assets, placing eyes on how Britain will follow.

Tulip Siddiq Resigns

On Tuesday, Jan. 14, Siddiq resigned from the British government after multiple media reports suggested she had benefited from her family’s rule of Bangladesh through London real estate gifts.

In December, Siddiq was named in an investigation into claims her family embezzled over £3 billion from infrastructure spending in Bangladesh.

In a letter to Prime Minister Keir Starmer announcing her resignation, Siddiq said it was clear her role was likely to become a “distraction from the work of the government.”

However, she said that the Prime Minister’s ethics adviser, Laurie Magnus, confirmed she had not “breached the ministerial code” and there was “no evidence” of wrongdoing.

Siddiq said she had shared the “full details of my finances and living arrangements, both present and historic.”

In a letter accepting Siddiq’s resignation, Starmer said the “door remains open” for her.

Conservative MPs have criticized the Prime Minister’s stance on the situation, with opposition leader Kemi Badenoch calling Starmer “weak.”

“It was clear at the weekend that the anti-corruption minister’s position was completely untenable,” she posted on X . “Yet Keir Starmer dithered and delayed to protect his close friend.”

“Even now, as Bangladesh files a criminal case against Tulip Siddiq, he expresses ‘sadness’ at her inevitable resignation,” she added. “Weak leadership from a weak prime minister.”

Siddiq and U.K. Crypto

During her tenure as Economic Secretary to the Treasury, Siddiq has been a prominent advocate for crypto regulation in the U.K.

Under her leadership, the Treasury announced plans to introduce comprehensive regulations covering stablecoins and staking by early 2025, aiming to provide clarity and confidence to investors and maintain London’s status as a leading financial center.

In November, Siddiq told the U.K. Tokenization Summit although regulatory developments for digital assets in the U.K. “seemed quiet,” the Treasury had “not stopped over recent months.”

“It is clear crypto assets are here to stay,” Siddiq said. “The number of people that own crypto is rising year-on-year, in the U.K. and globally.”

The minister said the government was set to draft a regulatory framework for the crypto industry by early 2025. Siddiq said the new regulations would focus on crypto, stablecoins, and staking services.

“Doing everything in a single phase is simpler, and it just makes more sense,” Siddiq said.

However, Siddiq said stablecoins do not fit into the current payment services regulation.

“Stablecoins will receive distinct treatment under these regulations, as their functionality does not align with existing payment services rules,” Siddiq said.

At the same time, she said the Labour government would adhere to most of the proposals made by the previous Conservative government.

In October 2023, the U.K. government released a list of in-depth proposals for regulating crypto.

“I can confirm that those proposals still stand, and that the government intends to implement them in full,” Siddiq said. “We aim to engage firms on draft legal provisions for the crypto asset regime, including stablecoins, as early as possible next year,” she added.

The Future of U.K. Digital Asset Regulation

As a vocal advocate for crypto regulation in the government, Siddiq’s resignation could potentially lead to another quiet period for the industry.

However, Britain will likely continue pushing full steam ahead with its regulation plans to keep up with the rapid pace of crypto adoption.

Research from the Financial Conduct Authority (FCA) in November found that 12% of U.K. adults now own crypto, a significant increase from 10% in 2022. Adults reportedly hold an average of £1,842, increasing from £1,595.

“Our research results highlight the need for clear regulation that supports a safe, competitive, and sustainable crypto sector in the U.K.,” said Matthew Long, director of payments and digital assets at the watchdog.

The FCA tightened its rules over the sale of crypto last year, enforcing new measures to ensure that companies promoting digital assets gave a “clear warning” against “high-risk” investments.

At the same time, the watchdog released its “crypto roadmap,” which detailed its plans to create a complete regulatory framework for digital assets by 2026.

Despite this, some experts have remained conscious of an over-focus on regulation.

Anthony Yeung, Global Head of Strategic Development at CoinCover, told CCN that the U.K. crypto firms also need to take responsibility.

“… we can’t rely on regulation alone to drive sector maturity and crypto firms must also take responsibility,” Yeung said.

“Proactively investing in fraud prevention, compliance, and security will not only help crypto firms meet likely forthcoming regulations but also enables them to send a strong signal to customers that their funds are indeed safe and secure.”

Yeung said that proactively investing in “fraud prevention, compliance, and security” will help crypto firms meet forthcoming regulations and send a clear signal to customers that their funds are safe and secure.

“Alongside smart regulatory frameworks, this will be key for crypto to secure its future as a credible alternative to traditional finance,” he added.