London’s crypto move is a sign of desperate times

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NEW YORK/LONDON, June 12 (Reuters Breakingviews) – British Prime Minister Rishi Sunak is eager to bring some Silicon Valley glitz to London. Today, venture capitalist Andreessen Horowitz is setting up his first non-US office in the UK capital, to focus on blockchain and cryptocurrencies. Both sides could use a win.

The company known as a16z could benefit from some geographic diversification. Crypto funds make up about 20% of its $35 billion in assets, but the U.S. Securities and Exchange Commission stepped up its crackdown last week by filing a lawsuit against Binance and Coinbase Global (COIN.O), the two largest crypto exchanges.

Sunak, who holds an MBA from Stanford University, has a habit of endorsing flawed tech companies. In 2021, the then finance minister said Deliveroo’s (ROO.L) decision to list its shares in London was fantastic. The IPO of food delivery companies was a flop. Yet when asked by a reporter if he was embarrassed by her endorsement, Sunak replied, God, no!

Other UK plans have also been disappointing: A £1bn ($1.3bn) plan to invest in semiconductors pales in comparison to the US $200bn+ chip law . And it didn’t help when Activision Blizzard’s (ATVI.O) CEO Bobby Kotick accused the UK of being shut down after the country’s antitrust regulator rejected the gaming group’s acquisition by Microsoft (MSFT.O).

Despite Sunaks’ call for the UK to embrace new innovations like blockchain, Britain’s appetite for crypto remains uncertain. Lawmakers are still debating how to regulate digital assets. London’s status as a crypto haven is far from a done deal. (By Anita Ramaswamy and Karen Kwok)

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(The author is a Reuters Breakingviews columnist. Opinions expressed are her own. This story has been reclassified to correct a typo in paragraph 4)

Editing by Peter Thal Larsen and Streisand Neto

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The opinions expressed are those of the author. They do not reflect the views of Reuters News, which is committed to integrity, independence and non-partisanship by principles of trust.

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