Hedera executive Arredondo said in an interview from London that the UK’s crypto policy ambitions look strong on paper, but progress has moved much more slowly in practice. Drawing on her time at the Financial Conduct Authority during and after Brexit, she said a clear gap has opened between policy goals and real-world execution, and that gap has weighed on the country’s regulatory momentum.
Brexit, the pandemic, and investment failures reshaped priorities
Arredondo linked much of the slowdown to the FCA’s heavy workload between 2018 and 2021. Brexit forced the regulator to rewrite a large body of rules for a post-EU environment. Then the COVID-19 pandemic pushed attention toward crisis management across the financial sector. The agenda changed quickly, and resources were stretched.
After that, major investment failures including London Capital & Finance and the Woodford Fund changed the tone again. She said those events drove the FCA to put stronger emphasis on consumer protection, with cryptoassets increasingly reviewed through that lens.
Large financial firms move faster than retail-focused entrants
She described the UK approach as developing on two separate tracks. Established financial institutions and wholesale market participants have seen relatively bold and proactive regulatory engagement. Newer startups, especially those targeting retail investors, are dealing with longer and more complicated approval processes.
According to Arredondo, regulators tend to be more proactive on the institutional side of crypto, while smaller firms are often made to fit into existing frameworks. That can extend licensing timelines. Unlike the European Union, which introduced a tailored crypto regime through MiCA, the UK has mostly adapted existing rule sets. For new applicants, that can mean repeated reviews by multiple teams and a lengthy path to approval. The targeted UK crypto measures are expected to be fully in force by October 2027.
Bank of England keeps a cautious line on stablecoins
The Bank of England is also moving carefully on stablecoins. In its latest framework, released after the interview, the central bank stepped back from previously discussed caps for individuals and institutions. It chose instead to impose a temporary circulation ceiling of £40 billion on any single systemically important stablecoin.
Interoperability seen as the next focus for digital currencies
In her work at Hedera, where she follows government digital currency and central bank digital currency trends, Arredondo said the main question is no longer the technology itself. She argued that the sector now needs interoperability: shared standards that let blockchain networks, stablecoins, and digital currency systems move data and value across different infrastructures.
She pointed to the European Union as a leading example, where stablecoins, tokenized bank deposits, and CBDCs are being developed to coexist within one framework. She also said the rising presence of banks, asset managers, and other institutional participants in crypto should be seen as mainstream adoption of earlier industry ideas into traditional finance.