London has emerged as the world’s leading crypto hub, new research has revealed.
England’s capital ranked highest in the world in the crypto-readiness index – devised by crypto tax software company Recap – closely followed by Dubai.
The index comprises eight criteria, including the number of crypto workers and companies, crypto meet-ups, quality of life score, and R&D spend as a percentage of GDP, in each city.
Along with having the highest number of people working in the crypto industry compared to anywhere else, London hosted the second highest number of crypto-related events and conferences throughout the year, and is home to over 800 crypto-based companies.
This is on track with plans made by Prime Minister Rishi Sunak, who set out in April 2022 to make the UK a ‘global hub for crypto-asset technology and investment’.
Dubai comes in second place as it pushes to become the leading centre for cryptocurrency and blockchain technology in the Middle East, following a year of multiple new laws for crypto exchanges to operate in the city.
Capital gains tax was also taken into consideration in the index – with Londoners paying up to 20%. Dubai currently has a rate of 0%, and may be the second choice for some UK residents: Holborn Assets revealed 200,000 Brits currently reside in the city – with 772 crypto-based companies to choose from when it comes to finding a career in the sector.
Third in the index was New York, ahead of Singapore, Los Angeles, Zug (Switzerland), Hong Kong, Paris, Vancouver and Bangkok.
“London being the world’s leading crypto hub is good news for the government’s plans to make the UK a ‘global hub for crypto-asset technology and investment’,” said Daniel Howitt, co-founder and CEO at Recap.
“At the same time, our research shows that the world’s least developed countries are significantly less prepared to become crypto-hubs. Lack of infrastructure, foreign investment, and skilled workforce in the area may explain why some are lagging behind.
“This could cause barriers to trade with more developed crypto-hubs in future – so it’s important they’re all given the opportunity to get up to speed.”
“While London excels in offering crypto events and jobs, as well as attracting crypto companies, the city falls behind when it comes to R&D spend and crypto ownership; we need to see more investment in these areas as a country in future, for London to continue to leading the race as a global crypto hub.”
Publication of the index coincided with draft plans published by the government to regulate the industry following the high-profile collapse of several crypto giants last year, including exchange FTX.
“Like many countries, the UK is forming new rules and regulations around crypto taxation. Whether this will help or hinder London’s place as a crypto hub is something to look out for in the future,” said Andrew Griffith, economic secretary to the Treasury.
“We believe that crypto technologies can have a profound impact across financial services. By capitalising on the potential benefits offered by crypto, we can strengthen our position as a world leader in fintech, unlock growth and boost innovation.”