Story by: Billy Bambrough
Bitcoin, cryptocurrency and blockchain startups exploded onto the London financial technology scene over the last few years, but now, due to a combination of potentially tougher new regulation and the UK’s looming exit from the European Union, things could be about to take a turn for the worse for the fledgling bitcoin and crypto sector.
The U.K.’s prime minister, Boris Johnson, who has taken over from Theresa May after she spent two fruitless years trying to negotiate a Brexit deal with the E.U., has steered the country towards a feared so-called no-deal Brexit scenario, potentially causing chaos–though perhaps boosting the bitcoin price.
While Johnson has clashed with the U.K.’s parliament over the possibility of a no-deal Brexit, it remains on the table, fueling business uncertainty.
If the U.K. does eventually leave the E.U. trading bloc without a deal, financial technology companies would lose access to the bloc’s single market–while bitcoin and cryptocurrency startups may struggle to justify a London office without an easy route into Europe.
“The uncertainty around Brexit has already taken a major toll, particularly for non-U.K. companies doing business in the U.K.,” said Felix Shipkevich, a New York-based lawyer specializing in digital currency and financial technology.
Financial technology businesses have already been found to be moving from the U.K. to the E.U. in preparation for Brexit, according to report from capital markets think tank New Financial, out earlier this year.