The co-CEO of Kraken has criticised the UK cryptocurrency market, saying it is being severely hampered by many laws and restrictions.
The remarks coincide with reports that 75% of Kraken’s U.S. services are inaccessible to U.K. consumers, and industry executives caution that the U.S. is quickly leading the world in crypto innovation.
Slams U.K. crypto rules
Kraken co-chief executive Arjun Sethi compared the required warnings to “cigarette box” labels in an interview with the Financial Times, claiming that Britain’s regulations on cryptocurrency marketing had caused needless friction for investors.
“In the U.K. today, if you go to any crypto website, including Kraken’s, you see the equivalent to a cigarette box [warning] — ‘use this and you’re going to die’,” Sethi told the publication.
The marketing regulations, which were implemented by the Financial Conduct Authority (FCA) in late 2023, mandate that cryptocurrency companies post conspicuous risk warnings and demand clients to complete “appropriateness assessments” prior to allowing them to purchase digital assets.
Also Read: US And UK Launch Joint Taskforce For Boosting Crypto Markets Of The Future
Sethi argues that the regulations have gone too far, despite regulators’ statements that they are intended to make sure customers are aware of the dangers before investing.
“Because of the speed at which they have to do the transaction, it’s worse for consumers,” he said, adding that while disclosures are essential, “if there are 14 steps, it’s worse.”
According to Sethi, the regulations are deterring regular investors from taking advantage of possibilities that exist elsewhere.
Kraken on tokenised stocks
Sethi discussed tokenised real-world assets (RWAs), which are digital tokens that signify ownership in conventional assets like stocks, bonds, or real estate, as another emerging trend.
Sethi stated that Kraken had no intention of offering tokenised shares of private firms, citing Robinhood’s tokenised OpenAI shares as “a terrible idea.”
He cautioned that tokenising private business equity has “significant legal and liquidity risks,” especially for non-publicly traded companies. Sethi claims that these products have the potential to deceive investors into thinking they are obtaining legal ownership holdings when, in reality, they are buying unregulated digital derivatives.
UK and crypto
The UK tax authority has boosted its scrutiny of cryptocurrency investors.
During the 2024–2025 tax year, HM Revenue & Customs (HMRC) sent out around 65,000 letters, up from 27,700 the year before, to individuals suspected of underreporting or avoiding taxes on earnings from cryptocurrencies.
Industry experts like Sethi contend that the UK has to strike a better balance between investor safety and innovation as the adoption of cryptocurrencies throughout the world picks up speed.
If not, the nation runs the danger of losing its competitive advantage to crypto-friendly centres like Singapore, Hong Kong, and the United States.
Also Read: Major UK Banks Join Forces With UK Finance To Explore Tokenized Sterling Deposit