Report on the UK's blockchain landscape confirms London as global hub
Published on 19th Nov 2021
The Big Innovation Centre highlights the strength and breadth of UK's blockchain ecosystem in its new report
On 3 November, the Big innovation Centre, a think-tank for innovation and technology insights, released a report on the UK blockchain industry. The report profiles around a thousand blockchain-centric companies, investors and influencers in the UK. As such, it is the most comprehensive overview of the UK blockchain industry to date, giving insights into the active market participants and trends.
What did the report conclude?
We highlight the following key findings from the report:
• Market confidence in blockchain is high in the UK. There are at least 500 blockchain companies, 250 investors, 50 hubs, and 15 government agencies active in the UK. Over £1.6bn has been invested in UK blockchain businesses.
• London is a global hub for blockchain. Somewhat unsurprisingly, the tech tends to be located near important financial markets. The report recognises London's status as a global financial centre which, in our view, is likely to remain the case notwithstanding any impact of Brexit. As such, London is a prime candidate for blockchain innovation.
• Strong activity around financial services applications. The report maps blockchain companies against their industries. These maps provide a useful visualisation of the industry, highlighting prominent and growth sectors. Although blockchain-centric businesses from a wide variety of different sectors are represented, many fall within the crypto and fintech sectors (for example, crypto trading platforms and token issuers) and financial services applications more generally are a clear focus of activity.
• The UK's blockchain talent is strong and growing. The UK market's sophistication brings investment confidence and industry growth, boosted by a highly integrated talent innovation system across industries, including science, tech and entrepreneurship. These systems are integrated within a network of blockchain think-tanks and events companies, which are helping to build the UK into a world-leading blockchain community.
• Blockchain applications have moved beyond proof of concept. The report identifies live use cases of the technology in both the public and private spheres and across divergent sectors, including art, logistics and health. The potential for blockchain to drive sustainability and deliver social benefits is starting to be realised in practice, with investment in areas like govtech (that is, systems to support democratic or public administrative processes) and energy highlighted.
• Co-operation with regulators is crucial. Through active engagement and open dialogue with regulators, stakeholders in the UK blockchain ecosystem can feed into shaping discussions and standards, and solidify the UK's position as a reputable market for blockchain activity on a global basis. That said, given the rapid pace of development within the global blockchain industry, regulators must act quickly and pragmatically to avoid the UK falling behind. Regulators in other jurisdictions have been quicker to respond to, and give clarity on, some of the issues (particularly around the interface with financial regulation), and the UK must not risk being caught flat-footed.
The report also contains a series of market maps for the UK blockchain industry which provides a useful reference point.
Osborne Clarke comment
Quite rightly, the report paints a positive picture of the UK's blockchain industry, recognising London as a global hub. While the conclusions are generally not surprising (such as the huge activity in the crypto and fintech space), the report does highlight several areas which have as-yet-untapped potential for investment and expansion. For example, with such a huge focus on decarbonisation and the green agenda, it seems almost inevitable that blockchain has a role to play in the cleantech revolution taking place in the energy sector.
Much of the report chimes with our own market experience, and we would be very happy to discuss that, or any aspect of the report, further.