Amid waning poll numbers and pressure from inside the Labour Party, Prime Minister Keir Starmer has stepped down.
During Starmer’s tenure, the government introduced a moratorium on cryptocurrency donations to political campaigns, citing concerns that crypto could become a vector for foreign influence in UK elections. Beyond the ban, the UK has charted a cautious path on crypto regulation under the Labour government.
Starmer’s departure from Number 10 has started discussions about his successor. A frontrunner has emerged in Andy Burnham, a member of parliament for Makerfield and former Mayor of Greater Manchester.
Burnham has expressed optimism about the blockchain industry’s ability to support economic development. But it remains to be seen whether that enthusiasm can translate into real policy moves.
Burnham wanted Manchester to be a “Web 3 powerhouse”
A graduate of Cambridge, Burnham served as a Cabinet minister under both Tony Blair and Gordon Brown, both as Health Secretary and Culture Secretary. From 2010 to 2015, he served as Shadow Education Secretary and Shadow Health Secretary under Ed Miliband before unsuccessfully contesting the Labor leadership bid in 2015.
From 2015-2016, he was Shadow Home Secretary under Jeremy Corbyn before leaving Westminster to become Mayor of Manchester in 2017.
As mayor, Burnham has consistently framed digital technology as an economic development tool and a way of driving growth and jobs in the city. This framing was evident at a Stand With Crypto and Manchester Blockchain Alliance event, where he said, “I’m bought in.”
He further noted his commitment to “make [Manchester] the Web3 powerhouse that we want it to be.”
Whether this will translate into a coherent national policy is another matter. As mayor, Burnham championed a model dubbed “Manchesterism,” which prioritized devolution, regional economic control and public-private partnerships.
It’s a bottom-up approach that, some observers in the crypto industry say, needs to be amplified if it’s to bring national-level change to the industry.
Nick Jones, founder and CEO of UK digital assets services platform Zumo, told Cointelegraph, “Burnham’s rhetoric on crypto has to date been heavily influenced by his role as Mayor of Greater Manchester. For example, he has previously drawn parallels between digital innovation and historical developments, pointing out that Manchester was the home of the Industrial Revolution and has the potential to become the home of the Web3 revolution.”
“But such soundbites were to be expected in the context of his role. If he becomes Prime Minister, he will be well aware of the need to amplify that ambition and ensure the UK as a whole sits at the heart of the world’s future financial system,” he said.
Related: UK central bank is warming up to stablecoins, but says industry input is lacking
Benoit Marzouk, the CEO of GBP stablecoin tGBP, told Cointelegraph that Burnham’s Manchester experience “is not a handicap.” Rather, his experience outside Westminster, “could help implement and accelerate the right policies for the digital asset industry across the UK.”
Burnham has not yet published a detailed digital assets policy. His public comments about crypto reflect broader enthusiasm rather than specific regulatory commitments. He has not yet addressed the Financial Conduct Authority’s crypto framework, stablecoin law, or the crypto political donation ban on public record.
The donation ban, politics, and what Burnham could actually do
In March, Stamer’s government banned crypto donations to political campaigns over concerns of foreign influence in British elections.
The ban followed an independent review by Philip Rycroft, a former civil servant turned consultant, who found that the pseudonymous nature of crypto assets created unacceptable risks to political financing transparency.
Reversing a policy introduced on the recommendation of an independent review carries political risk. Labor’s left could scrutinize any move that appears to open the party to crypto money, which Reform UK has used to fund its leading performance in recent local elections.
According to Reuters, crypto donations from billionaires based overseas put Reform well ahead of Labour in the fundraising race. Reform’s leader Nigel Farage is under investigation for an undisclosed 5 million pound ($6.6 million) gift from British Thai-based businessman Christopher Harborne.
Despite obvious ethics concerns, Farage said he should be able to spend the gift however he wishes, be it for campaigning, or on Ferraris and betting on horses.
Amid political concerns over the temporary moratorium, a 180-degree ban reversal from Burnham seems unlikely.
Marzouk expects Burnham to exhibit “pragmatism rather than political announcements.” For tGBP, success in the first year of a Burnham premiership would include a finalized stablecoin framework, pilot programs involving government and GBP stablecoins and continuing work on tokenization.
Tom Rhodes, chief legal officer for UK stablecoin issuer Agant, told Cointelegraph, “We don’t expect the next PM to interfere with any specific policies. The regulators remain independent and cryptoasset regulation is nearly settled.”
Jones said that Burnham is “on record strongly backing the underlying economic potential of our nascent sector.”
“If he does become the next Prime Minister, it’s unlikely his position will change. I believe he would continue to pursue the current growth-focused policy approach.”
The transition period could be bumpy, stalling momentum, according to Jones. “Any potential cabinet reshuffle could displace ministers who are familiar with the evolving regulatory regime at the critical inflection point when regulators and industry alike are preparing for authorization, and that would be a problem.”
Labour is yet to announce an official timetable for replacing Starmer, although the former PM has said that he’d like to see nominations open on July 9, after a NATO summit. According to Sky News, it could be a week later, on July 16, when parliament goes on summer recess.
The winner must receive more than half the votes cast. If no one receives the necessary votes, then ballots are recast based on preference.
Magazine: Bitcoin decouples from tech stocks, Ether eyes ‘selling wave’: Market Moves
