Bitcoin and other cryptocurrencies are facing a crackdown by governments and banks in an effort to protect consumers and secure regulation.
Cryptocurrency technology currently allows users to make payments and store money on the internet without needing to use their name or a bank.
Labour MP Alison McGovern on the Treasury Select Committee said Britain currently has a “real life situation” with cryptocurrencies and it needs to act on it now.
Speaking on BBC’s Panorama, Ms McGovern said: “We have begun to ask questions and look at it. But I don’t think anyone in British politics or the regulation system in our country is going at the right speed, bearing in mind what has happened in cryptocurrency over the past few months.
“I think that today cryptocurrency has not been on Parliament’s agenda or on the agenda in Whitehall that much.
“I think probably hand on heart we have all been too slow but the opportunity is not lost and we should get on with the job now.”
Theresa May has previously warned about the dangers of cryptocurrencies and said it is something that should be looked at “very seriously”.
Bitcoin price reached £14,000 in December, before rapidly falling to less than £6,000 in January at a time when banks announced tougher regulations on cryptocurrencies.
Lloyds Bank said they would apply a ban on customers buying bitcoin and other cryptocurrencies with their credit cards.
Lloyds told its eight million credit card customers in January that any attempts to buy cryptocurrencies will be blocked.
Other British banks are expected to follow suit over the coming weeks after several of the biggest US banks including JP Morgan, Bank of America and Citigroup all confirmed plans to block attempts to buy digital currencies.
A spokesman for Lloyds said the decision was made to “protect customers” in what is thought to be a pre-emptive move to reduce the risks that come with the volatile cryptocurrency.
World leaders are expected to hold talks on Bitcoin at next month’s G20 summit after French and German officials called for a discussion on cryptocurrencies at a March meeting.
The finance minister and Central Bank Governors of France and Germany have requested that talks on policy and monetary implications of cryptocurrencies be part of the agenda for the meeting.
Bitcoin price decreased to $8,588.89 at 14:24 on Tuesday, according to CoinDesk. It saw its highest value before Christmas when it reached the monumental price of just under $20,000.