UK House of Lords Passes Amendment Mandating Digital Asset Strategy Despite Labour Opposition

The UK House of Lords has passed an amendment requiring the government to formulate a digital asset strategy. The measure was approved by 194 votes to 138 despite opposition from the ruling Labour Party.

Cointelegraph reported on September 10 that the upper chamber adopted Amendment 88 during its review of the Financial Services and Markets Bill. The amendment was proposed by Conservative peer Baroness Neville-Rolfe.

Under the amendment, the UK Treasury must formulate and publish a digital asset strategy within 12 months of the Financial Services and Markets Act taking effect. It must also conduct a consultation on the plan. The strategy would cover crypto assets, stablecoins and tokenized securities.

More specifically, the strategy must reflect measures to promote innovation in the digital asset industry, protect consumers and improve related companies' access to banking, payments and settlement services.

The Labour government has opposed the amendment, arguing that a legal mandate would be difficult to reconcile with the speed of change in digital asset markets and the need for consistency in the regulatory framework. During a House of Lords debate in July, Treasury minister Lord Livermore, who is responsible for investment, said the government was already developing and implementing a digital asset strategy, signaling opposition to separate legislation.

The UK Cryptoasset Business Council welcomed the result of the vote. The group said it had participated in drafting the amendment and argued that the key issue in future discussions will be whether the UK limits itself to regulating digital assets or actively nurtures the industry.

The bill, as amended, will now return to the House of Commons. The lower chamber can accept the House of Lords' changes as they are, revise them or reject them.