Crypto Regulation: UK Efforts Ramp Up
by Tom Nyarunda
New UK regulation could restrict crypto adverts, criminalize the provision of services by unlicensed operators, restrict foreign companies' involvement, and control how companies are wound up.
Urgency to create order
The urgency to create order in finance’s “wild west” has been necessitated by crypto exchange FTX’s collapse last month after filing for US bankruptcy court protection. Sources told the Financial Times that the planned package of regulations gives the Financial Conduct Authority (FCA) sweeping powers to rein in the sector. It also allows the FCA to check how crypto firms operate and advertise their products. The laws could also limit how overseas firms access the British market.
The UK House of Commons unanimously passed the new Financial Services and Markets Bill that restricts crypto adverts and criminalizes unauthorized crypto operators last October. The committee added the measures to those agreed upon earlier, notwithstanding industry concerns that the new regulatory regime would make it harder to get crypto ads approved.
Crypto regulation UK agenda
While he was still Chancellor, current Prime Minister Rishi Sunak announced a grand plan to make the UK a crypto hub. The Government pressed on with its crypto regulation UK agenda amid the political turbulence that precipitated the fall of Boris Johnson and then Liz truss as leader.
Minister Andrew Griffith told lawmakers on 25 October that the new laws would enable regulating stablecoins and activities relating to other crypto assets like Bitcoin (BTC) and Ether (ETH). The original bill primarily focused on introducing a stablecoin as a means of payment that would be tied to tangible assets like the British pound.
British crypto firms and investors were optimistic that Sunak, a former Goldman Sachs analyst and a vocal crypto advocate, could turn around the UK's diminishing crypto aspirations. However, the persisting political instability, punishing digital asset prices, and a slew of corporate bankruptcies have left many industry players wondering how much he could do to change the fortunes of the crypto market that's still licking its wounds.
Crypto regulation UK may not exactly be on Sunak's priority list, but some insiders feel there's reason to be optimistic. While the FCA has faced criticism for its snail-paced approach in licensing crypto firms, leading to some companies winding down and relocating elsewhere in Europe, the recent licensing of the fintech app Revolut, after numerous extensions, offers a ray of hope.
Tom is a freelance writer with over 15-years’ experience in content creation, blog writing, and SEO specializing in the blockchain and cryptocurrency niche. He is a philosophical figurehead who believes that to make our world a better place, we must invest in incorruptible products and procedures, of which Bitcoin and other cryptocurrencies are leading examples.