Why Crypto's UKmaxxers Are Betting Against Negative Discourse

The first was Solana's weekly institutional co-working, spread over three levels of a domed, chandelier-bearing ex-courthouse on the periphery of London's Square Mile. The second, harking back to crypto's early days of sovereignty, hackathons and hoodies, was Forma's Demo Day, tucked into a darkened corner of the King's Cross technology district.

The online discourse isn't entirely wrong. "It's quite difficult for a British founder in a crypto company, in the sense that they can't market that app to their local users," said Stephen Newnham, head of startup community at Superteam UK. That, along with a reluctance among institutions to bank any company associated with crypto, and a slow rollout of regulatory clarity from the government, has made the environment a difficult one for crypto founders to find their footing.

Superteam UK has been running a campaign it calls Brain Drain to collect data on why technical talent leaves, on the premise that the loss compounds. "If you continue to hinder the innovation and competition here, then you just lose the people," Newnham said. "At a certain point you no longer have the network effects, and then that's a negative spiral because now people continue to leave because they're going elsewhere to get those network effects."

Despite the challenges, for now, a number of founders and leaders have decided to stay put in the UK's green and pleasant land, weathering the current tepid appetite with the conviction that it can, and will be, a global crypto hub.

The Bristol innovation hub

Forma, a Solana-linked innovation community, was named as a partner in the founding memorandum for Kazakhstan's Solana Economic Zone, launched in Astana on 30 May 2025 with the Solana Foundation's support, with the government committing to introduce support programs for international Web3 startups in collaboration with Forma. Solana Company, a separate, Nasdaq-listed entity, later signed its own agreement, in June 2026, to help build blockchain infrastructure for Alatau, the country's planned "digital first megacity".

However, Forma chose Bristol, UK to set up their first permanent hub. "We had five countries shortlisted and eight cities," said Babak Ahmadzadeh, co-founder of Forma.

The UK became a front-runner for the community on the strength of its universities and the density of technical talent around them, though Ahmadzadeh sees the country converting less of it than it should. "If you compare the UK with the US, we have an equal number of top 20 universities in the world, but we have 80% fewer entrepreneurs coming out of our universities," he said, putting the gap down to capital access and risk appetite rather than ability.

"Being next to great universities like Bristol and then all the other ones in London, it is a great center for us to help those people commercialize their IP," Ahmadzadeh said.

Wider support

His enthusiasm about the region is mirrored by others in the more institutional crypto community. Naseem Naqvi, founding president of the British Blockchain Association, a trade body focused on blockchain technology, described the UK sector as steadily maturing, with the gap between proof of concept and large-scale adoption being "where the UK now lives". "The underlying UK strengths are real," he said in written comments to Sandmark. "World-class universities and talent pool, deep fintech heritage, live tokenization pilots."

Founders, on his account, value the predictability of English common law and proximity to European markets, and the UK "still wins on institutional quality" against more crypto-native competitors. He also argued the demand is being misread. FCA research conducted across Aug and Sept 2025 found 8% of UK adults holding cryptoassets, down from 12% the year before, a figure widely reported as evidence of a cooling market. Naqvi points to a different number in the same study. "The more instructive number is the other one. 26% of non-users said they would be more likely to invest if the market were regulated," he said. "The constraint is confidence, not appetite."

Ben Brophy, head of institutional growth for Europe at the Solana Foundation, said he spends much of his time arguing against a description of Britain he considers wrong. "The outside perception is that regulation in the UK and Europe prohibits firms from doing anything," he said. "That's just materially not true, overtly not true."

He points to the launch of Baillie Gifford's bond fund, native on Solana in June and on Ethereum in July, on which the associated token becomes the legal record of ownership rather than a wrapper around a share register that holds it, which has been the standard practice for other institutional launches of tokenized products. "I have a full onchain product, full onchain books and records, stablecoin on and off ramp, fully native," Brophy said. "I do not have to come out into tradfi, into fiat, to use these products."

Baillie Gifford is a fully regulated entity under the purview of the FCA, which Brophy regards as significant – the tokenized fund was launched within the FCA's existing framework. "If you're looking at probably one of the top-tier products that are onchain today, it's coming out of the UK regulatory perimeter."

UK's Chokepoint 2.0?

In the last year, regulators have made some steps towards providing this clarity, publishing a final wording on a cryptoassets regime in Jun 2026 which is due to take effect in Oct 2027. However, Naqvi highlights the delay between when firms can apply for authorization, on 30 Sept 2026, and when they may be able to operate under the finished regime. "The candid assessment is that a firm applying this autumn may not be able to operate under the finished regime until late 2027," he said. "That is a long runway for a founder to finance."

He explained that divided remits between HM Treasury, the Bank of England and the FCA come up repeatedly in his conversations as a source of operational uncertainty, and several digital asset firms have already moved to jurisdictions offering immediate clarity. "What tips decisions is rarely the substance of UK rules," he said. "It is transitional friction or a competitor going live eighteen months earlier."

The result of this uncertainty and unwillingness to accept the industry by some of the UK's institutions, shows up in company registrations rather than the departure of its founders. Newnham explained that Superteam UK founders now live and build in the UK while running businesses domiciled elsewhere. "I don't have many founders that have UK companies," he said. Instead, some incorporate an operating company in Britain and roll it into a foreign parent later, others go straight to a Delaware C corporation or register in Dubai or Singapore.

For those who stay and go through the FCA's sandbox, he, like Naqvi, puts the cost at eighteen months of runway before anything reaches a customer.

In the meantime, one of the more immediate obstacles to building crypto products within the UK is, according to some, a bank account. "Consumers and builders are being blocked from transferring their own money to crypto asset exchanges," a spokesperson from Stand with Crypto, crypto regulation advocacy group, wrote to Sandmark. "It is impossible for the UK to become a global Web3 hub if the on-ramp from fiat to crypto is systematically choked off by banks applying blanket restrictions to the entire crypto asset industry." The group has launched a campaign asking builders to write to their banks demanding the blocks be lifted.

On 11 Aug, the co-chairs of the UK parliament's crypto and digital assets APPG sent a letter to the leaders of all major banks within the country citing reports of firms struggling to open accounts with the banks. The group asked banks for information regarding their approach to help them inform a "balanced evidence-based assessment" of banking access following the launch of an inquiry in July.

Brophy identifies two gaps that have surfaced within his own institutional positioning towards crypto ecosystem growth. British high street banks have not engaged as strongly as he would like, which he partly attributes to the industry's own failure to educate them. To drive this engagement, he said, the regulator could do more to signal that the institutions are permitted to serve crypto companies.

The pro-crypto candidate

Weeks prior to the publication of this article, Newnham, known as Cap online, had put his hat (or cap) in the ring for the Clacton by-election, a much-watched political race due to the controversial resignation of the region's former MP, Nigel Farage. The politician faced an inquiry from the Parliamentary Standards Commissioner, Daniel Greenberg, into an undeclared £5mn gift from Christopher Harborne, an investor in stablecoin issuer Tether. Farage resigned on 7 Jul, suspending the investigation, and is standing in the by-election he triggered on 13 Aug.

Newnham campaigned on turning Clacton into what he called an older generation tech hub, reversing the outflow of working-age residents, with AI literacy workshops for locals and a pledge to bring pensions onchain. Also onchain, he proposed, would be a record all of his functions as MP and region's tax revenue, letting citizens vote on budget allocation above guaranteed minimums for health and education. "Tax is how you're able to collect funds from the economy, it's how you've been able to invest back into public goods," he said. "Being able to change the relationship to things is the behavioral economist mindset." He did, however, concede that the idea may have been a "bit of a pipe dream".

On Farage he was careful, noting he has never spoken to Farage directly and that anything he offered was speculation. Farage spoke positively about the industry at Zebu Live, and Newnham read the pitch as electoral rather than technical. "It sounded like he was leaning towards, 'vote me in and I'll make some changes,'" he said. "It seems as if Farage wanted to tap into a different demographic. Trump did a similar playbook."

His test for any politician claiming to be pro-crypto is a technical interview about some of the basic elements of crypto. "Policymakers shouldn't make policies about things they don't understand."

While online, Newnham's announcement of his candidacy gained traction, the race in Clacton itself proved to be a hurdle. He explained that nominations required signatures collected in person within the constituency. The requirements were published on a Tuesday and the deadline fell at 4pm that Friday, and he was out of the country in between. "Because I couldn't physically be there, we missed the deadline," he said.

Positive parliamentarians

In Westminster, interest in the industry is already entering debates. Parliamentarians made 110 tracked references to digital assets during 2025, up from 91 the year before, according to Greengage's Digital Parliamentarians report, with stablecoins climbing from nothing whatsoever to 17 mentions. Of the 2025 total, 42% read as positive against 26% negative, and the framing shifted from fraud and criminal misuse towards implementation, tokenized securities and whether Britain can compete, with several members citing American deregulation as an argument for British speed.

The Stand With Crypto spokesperson said they had hosted Andy Burnham while he was still mayor of Greater Manchester. According to them, at the time, Burnham had presented as pro-crypto stating that, "In Manchester, we are about economic progress, we are about social progress, and if that is what Stand with Crypto is about, I am in." Burnham became prime minister on 20 Jul, but his administration has given no indication since about where, or whether, digital assets sit among its priorities.

The rules that have moved through in the last year are, however, broadly favourable to tokenization. The FCA confirmed in April that fund managers may keep their register of shareholders on a public blockchain, the change that made Baillie Gifford's structure possible, and the regulator has named sterling stablecoin payments a priority for the year.

The Bank of England, which has been slow to come on board with private stablecoin issuance, dropped its proposed individual holding limits on sterling stablecoins in June. While it replaced the limits with a temporary £40bn ceiling on how much of any single coin may exist, which is open for feedback until Sept, industry participants see the reversal as a successful result of engaging with policymakers to create a more hospitable environment.

"We've crossed the Rubicon," Brophy said. "It's not a question of if now, it's a question of when."