UKs ex-chancellor Philip Hammond joins crypto start-up Copper

Former British chancellor Lord Philip Hammond has become an adviser to Copper, a UK company specialising in cryptocurrency custody and trading.

Copper launched in 2018 and provides services to institutional investors, from digital currency asset managers to hedge funds and family offices. The company said it handled more than $50bn in transactions each month on behalf of roughly 400 clients.

Hammond said the UK had to embrace financial innovation to compete after Brexit. “The UK’s access to European financial markets will gradually decrease,” he told the Financial Times. “The only way that we’re going to be able to continue to secure full access is to have products and services which our EU neighbours clearly need to make their economies function effectively.”

Hammond, chancellor between 2016 and 2019, acknowledged that “the UK has not moved as quickly as Switzerland, Singapore and even Germany” on crypto regulation. “The challenge for us now is to persuade UK decision makers and regulators themselves that there is really an opportunity here.”

An advisory role at another UK fintech, Greensill Capital, ended in embarrassment for Hammond’s former Tory colleague, David Cameron. The former prime minister was dragged into a scandal when it emerged that he had lobbied vigorously on behalf of the firm before it collapsed.

Hammond said: “The Greensill experience is something that I think everybody has taken on board as a cautionary tale. I will certainly work closely with Copper to help them to develop their strategy but there are, quite properly, limits to what I can do, particularly in relation to the UK government and the company understands that.”

He said he has conducted due diligence on Copper. “It’s got a blue-chip client base, it’s got blue-chip investors behind it and it’s got proprietary technology which is rapidly emerging as the preferred option for trading and preserving crypto assets around the world.”

In June, the company received investment from fund manager Alan Howard, who contributed $12.5m to the company’s $75m funding round.

It is registered with the Financial Conduct Authority under the regulator’s temporary regime, which allows UK crypto custody and trading firms to keep operating while the watchdog reviews their policies to tackle money laundering and terrorism financing.

Dmitry Tokarev, chief executive of Copper, said the company was keen to grow “within a regulatory framework which will allow us to thrive globally from our London headquarters”.

Crypto firms have accelerated their hiring of high-profile figures from the financial and tech sectors this year. Former US Securities and Exchange Commission chair Jay Clayton joined New York-based crypto custodian Fireblocks as an adviser in August.

Hammond quit politics ahead of December 2019’s general election after falling out with Boris Johnson, the prime minister, and the Conservative party over Brexit.

The UK lobbying regulator said earlier this year that it was investigating whether Hammond should have registered as a lobbyist when he contacted a top Treasury official to promote software devised by OakNorth, a bank he advises.

Last month the Office of the Registrar of Consultant Lobbyists said it had accepted Hammond’s argument that his approach fell within an exemption to its rules, and he was cleared of breaching lobbying rules.