Gemini’s decision to exit the United Kingdom, the European Union, and Australia to refocus on the United States and Singapore has sharpened debate over whether the UK’s unfinished crypto rulebook is deterring firms policymakers hoped to attract. The move comes nearly three years after the UK government publicly committed to making the country a global center for cryptoasset technology.
In a strategy update published February 5, Gemini said several international markets had proven “hard to win,” leaving the exchange operationally stretched and facing rising organizational complexity and costs. While the company did not single out regulators, industry groups say the decision reflects mounting frustration with regulatory uncertainty and compliance burdens relative to market opportunity.
Regulatory Ambition Meets Execution Risk
In April 2022, then-Chancellor Rishi Sunak outlined plans to position the UK as a global crypto hub, announcing stablecoin legislation and launching a Financial Conduct Authority CryptoSprint to accelerate rulemaking. Nearly four years later, large parts of the framework remain in transition, with firms operating under interim guidance and overlapping regimes.
Susie Violet Ward, chief executive of Bitcoin Policy UK, said Gemini’s exit illustrates how drawn-out rulemaking and high compliance costs are discouraging investment. She noted that companies face a patchwork of anti-money laundering registration, financial promotions rules, and provisional standards while a full prudential regime remains years away. According to Ward, capital deployment depends on regulatory clarity and confidence, both of which remain limited.
Laura Navaratnam, head of UK policy at the Crypto Council for Innovation, described Gemini’s withdrawal as a blow for policymakers attempting to finalize the framework ahead of license applications opening later this year. Under current proposals, crypto firms serving UK customers will need to apply for full FCA authorization during a five-month gateway window from late 2026, before the new regime takes effect in 2027.
Compliance Costs and Competitive Pressure
Industry executives warn that unresolved issues could prompt further exits. Navaratnam highlighted uncertainty around how the FCA’s stablecoin rules will interact with the Bank of England’s systemic oversight regime, raising the risk of abrupt transitions for firms as they scale. Without alignment, companies may face a regulatory cliff edge as they move between frameworks.
CoinJar chief executive Asher Tan said the shift from a limited AML registration model to full Financial Services and Markets Act authorization materially raises the operational burden for exchanges. Firms must now weigh the cost of meeting higher capital, liquidity, and governance standards against the commercial opportunity of the UK market.
While retrenchment is not unique to Britain, critics argue the UK risks losing ground to jurisdictions offering clearer timelines and more predictable requirements. Surveys cited by Bitcoin Policy UK indicate that banking access challenges and account closures remain common, further complicating operations for crypto businesses.
The FCA is currently consulting on a proposed prudential regime that would extend its rules to trading, staking, and dealing activities, embedding capital and liquidity requirements across the sector. The consultation closes this week, with the full regime expected to take effect in late 2027.
For firms considering long-term commitments, the direction of travel may be clear, but the costs are rising. Gemini’s exit suggests that until the UK delivers a coherent and timely framework, its ambition to be a global crypto hub will remain difficult to realize.
