Why Rishi Sunak’s crypto investment quote has the tech industry excited
When storied Silicon Valley investment firm Andreessen Horowitz made the announcement that it would be setting up a dedicated crypto arm in the UK yesterday – the firm’s first base outside the US – the announcement came with high profile backing: the Prime Minister, Rishi Sunak.
Sunak championed the launch on Twitter and said in a statement: “I am thrilled world-leading investor Andreessen Horowitz has decided to open their first international office in the UK – which is testament to our world-class universities and talent and our strong competitive business environment.”
Sunak has history with the sector. As chancellor last year, he launched the campaign to make the UK a hub for crypto firms before the industry was rocked by a deep crypto winter, triggered by surging interest rates and the implosion of a host of big name firms in the industry.
The government has since tabled plans to bring the sector within the remit of regulators and a clampdown is looming this year.
Sunak’s crypto intent
However, the move from Sunak to personally champion the move from Andreessen Horowitz with a statement has been hailed by tech figures in the UK as a “significant” and a sign of intent.
“With Andreessen Horowitz’s new offices focused on crypto and blockchain startups, this is a vote of confidence for the UK in this space at a time when big crypto companies are at loggerheads with financial regulators in the US,” Russ Shaw, the chief of Tech London Advocates, told City PM
“It’s significant that the Prime Minister has personally lent his support to the decision, underscoring his desire to ensure Britain maintains competitive business conditions and recognising the ongoing importance of the tech sector to the country’s wider economic recovery.”
It speaks volumes that the PM himself has applauded the move and is seeing it as a testament to the robust and ambitious business environment the UK has to offer,” said Janine Hirt, chief of fintech industry body Innovate Finance.
Michael Moore, chief of the British Venture Capital Association, told City PM the move from Andreessen Horowitz to set up in London was a “fantastic development for UK tech” and reflects the “dynamic hub the UK has become for a range of new technologies”.
The move from Andreessen Horowitz comes amid a period of panic in the UK as policymakers and regulators fret over the dwindling appeal of London as a tech hub on the global stage.
Officials have been scrambling to stem a flood of firms away from London with regulatory tweaks and sweeping reviews, including the landmark 2020 Kalifa review of fintech.
However, Simon Taylor, a fintech analyst wrote yesterday that the tech sector in the UK could be “getting its tech mojo back”.
“The biggest thing about Andreessen Horowitz setting up a UK office is the Prime Minister welcoming it,” he said.
“[From] 2010 to 2016 the UK did two things – great marketing with ministers giving vocal support [and passing] competitive legislation and regulations to play to the UK’s strength.”
He added: “We’re seeing the UK do the marketing bit” and eyes will now be on the Financial Services and Markets Bill passing through parliament, which is set to grant fresh powers to regulators.