Recommendation 98

A number of witnesses referenced the FCA’s approach to regulating digital assets. Charles McManus, Chief Executive Officer of ClearBank, highlighted that the opportunities offered by fund tokenisation and digitalisation are significant, citing the example of global stablecoin valuations which stood at $650 billion in summer 2024 and are projected to reach $2.2 trillion by 2028. 159 However, we received evidence that there are notable regulatory barriers to the growth of this sector in the UK. The Digital Currencies Governance Group told us that: “The FCA’s approval rate of 13% for cryptoasset firms under the Money Laundering Regulations (MLRs) significantly lags behind international benchmarks, such as the EU’s Markets in Crypto-Assets (MiCA)”. 160