Can Krypto fill the gap that Russian money left in Great Britain?

Out with the oligarchs. Purely with the crypto bars.

so it definitely came across. In a minute, the British government imposed strict sanctions against people such as Roman Abramovich and Mikhail Fridman in accordance with western politics towards Kremlin -close business people, thus effectively completing an era of adapting such Russian billionaires. Next, it threw its weight behind "UK Crypto", an attempt to take "the capitalist energy" of the City of London and to make Britain a "hospitable place for crypto".

Since El Salvador made the controversial and unprecedented decision last year to introduce Bitcoin as a legal means of payment, a government with such a vigor has rolled out a red carpet for crypto.

This representation is of course a bit unfair. The unveiling of the Ministry of Finance last week about its plans for the introduction of a crypto ecosystem is careful when reading the small print. A lot is talked about effective regulation. There is a focus on stable coins - which are supposedly anchored on currencies of the Old World like the dollar - and not to Bitcoin or Ethereum from the Wild West. And the greatest enthusiasm seems to be aimed at architecture, which is based on crypto, so-called distributed Ledger technology such as blockchain, which is widespread.

nfts - the incarnation of crypto in the art world - are such an insignificant mania as any other since the tulip onion craze in the Holland of the 17th century

The government is rightly in favor of innovation and top technology. As long as the framework conditions are well thought out, it is a commendable policy to make the United Kingdom a magnet for digital investments - and a crucial one if the city wants to keep its performance in international finance.

Some aspects of the crypto landscape can really fulfill some of the advantages mentioned, such as: B. a higher efficiency, although problems with the scaling of the blockchain remain and the long -expressed criticism still applies: This is a technology that is looking for a problem and not for much -being solution.

But apart from the advantages, the look was not good last week. Chancellor Rishi Sunak's enthusiastic hug so -called non -funnia tokens when he asked the Royal Mint to develop an NFT that was supposed to stand next to its series of collectible commemorative coins.

wanting to beat a cutting -edge image is everything very good. But NFTS - the incarnation of crypto in the art world - are such an insignificant mania as any other since the tulip onion craze in the Holland of the 17th century. By connecting to the concept so personally, the Chancellor accepts as much money as every NFT investor (even if the risk of this connection has been trumped in the past few days by the increasing dispute over his wife's tax status).

The government says that it wants to be "on the ground floor" of this emerging market so that it could "go". But many other countries, from Singapore to Spain, used to introduce crypto guidelines. To this day, the United Kingdom is terrifyingly slow to contain dubious practices. Promised changes in the law to give the Financial Conduct Authority powers about misleading crypto advertising. Nothing noteworthy was done to act against misinformation on social media.

During my multiple visits to British secondary schools in the past few months as part of the Financial Literacy and Inclusion Campaign The FT, students have often asked questions about cryptoinvestitations. Many felt encouraged by social media influencers to buy crypto. Many have lost large sums. Few really understood what they did or what risks are associated with it. It would be an admirable government initiative to proceed against "Pump and Dump" abuse on social media and to force crypto operators to clearly explain risks-but start a campaign for industry and support it with its own NFT is hardly that.

At the same time, the crypto cult radiates oligarchic arrogance. It is a ruinous waste of energy and collides head -on with the supposedly green references of the government. It has a loose attitude towards tax liabilities, which is largely undisputed by HM Revenue & Customs. (The FCA estimates that there are 2.3 million crypto investors in the United Kingdom, but the HMRC has sent capital gains tax "kick-off letters" to almost 8,000

Die-hard Bitcoin lovers could of course argue that this is the core of the existence of crypto: It was designed as an anarchic revolt against the state control of the monetary system. In fact, last week the tech entrepreneur Peter Thiel praised at a conference in Miami Krypto as a "revolutionary youth movement" against the "financial geronotraty". Therefore, its use - as a wild speculative barge and anonymized means of paying for illegal drugs, washing money or bypassing sanctions - perhaps granted.

One might think that such talks would make the Ministry of Finance suspicious. Instead, it seems to be blinded by the bling. After the 2008 financial crisis, Adair Turner, the then chairman of the now dissolved supervisory authority of the Financial Services Authority, has memorized a large part of the financial industry as "socially useless". How much more suitable is this description of today's crypto madness?

patrick.jenkins@ft.com