The UK House of Lords backed a requirement for the Treasury to develop a national digital asset strategy, approving Amendment 88 by 194 votes to 138 during the report stage of the Financial Services and Markets Bill on September 9.

Under the amendment, the Treasury would have 12 months after the legislation passes to prepare, publish and consult on a strategy covering cryptoassets, qualifying stablecoins, central bank digital currencies, tokenized securities and other digital financial assets. The review would also cover the infrastructure required for digital markets to operate in the UK, giving the proposed strategy a scope beyond rules for individual types of assets.

Strategy Would Address Banking Access and Global Competition

Introduced by Conservative peer Baroness Neville-Rolfe alongside Lord Altrincham and Liberal Democrat peer Baroness Kramer, the measure would require the Treasury to assess how digital asset firms operate within existing legal, regulatory and market conditions.

The proposed strategy would specifically examine firms’ access to banking, payment and settlement services. It would also consider how blanket restrictions, or restrictions that are insufficiently sensitive to different levels of risk, could affect competition, innovation and lawful participation in the market.

In addition, the Treasury would be required to consider regulatory developments in other jurisdictions, consumer protection, market integrity, financial stability and the UK’s international competitiveness. During the debate, Lord Ranger of Northwood cited the US GENIUS and CLARITY Acts as evidence that competing financial centers are advancing digital asset policy.

The consultation would involve the Bank of England, the Prudential Regulation Authority, the Financial Conduct Authority, industry representatives and other parties selected by the Treasury. That process would place the main implementation questions—such as the interaction between regulators, financial infrastructure and access to services—within a single consultation framework if the amendment becomes law.

Government Points to Existing Digital-Market Work

The government argued that substantial work on digital assets is already underway. This includes its wholesale financial markets digital strategy and nine action groups led through Wholesale Digital Markets Champion Chris Woolard.

UK regulators have also advanced formal crypto supervision. The FCA has finalized its crypto rulebook, including requirements covering authorization, custody, market abuse and stablecoins. The Bank of England has separately established a systemic stablecoin framework for assets capable of affecting payments or financial stability.

Peers who supported Amendment 88 argued that these individual workstreams did not amount to an overarching strategy covering regulation, infrastructure, banking access and the broader digital asset economy. The debate therefore centers not only on whether separate regulatory initiatives are progressing, but also on whether they are coordinated through a wider national framework.

Bill Must Still Pass Third Reading and Commons Stages

The amendment is now part of the Financial Services and Markets Bill, but it has not become law. The bill remains in the House of Lords, where its third reading is scheduled for September 15.

After completing its Lords stages, the bill must proceed to the House of Commons. Members of Parliament can scrutinize and amend its provisions there. Any differences between the two chambers would then have to be resolved before Royal Assent. The next formal developments to watch are therefore the bill’s remaining parliamentary stages, rather than immediate publication of a Treasury strategy.

Primary parliamentary source: (HL)

Source: https://cryptoadventure.com/house-of-lords-backs-uk-digital-asset-strategy-in-194-138-vote