The British government has unveiled its long-awaited plans for regulating cryptocurrencies.
Included in that plan is the government’s intent to “bring a number of cryptoasset activities into the regulatory perimeter for financial services for the first time,” the U.K. Treasury said in its announcement Monday (Oct. 30).
According to the announcement, the government plans to introduce legislation next year to put the changes into effect.
Included in its plans is a requirement for crypto exchanges to come up with detailed admission standards and disclosure documents.
“The detailed contents of disclosure/admission documents will be defined by cryptoasset trading venues,” the report said. “However, this could include, for example, information about a token’s underlying code and network infrastructure, known vulnerabilities, risks and dependencies” such as reliance on a third party or decentralized blockchains.
Also Monday, the government announced plans to bring fiat-backed stablecoins under the purview of the Bank of England, Financial Conduct Authority (FCA) and Payment Systems Regulator (PSR).
This will “altogether will aim to minimize potential for customer harm and mitigate the conduct, prudential, and financial stability risks arising from those stablecoins, particularly when used for payments,” the announcement said.
The British treasury unveiled its proposed regulations for the crypto sector in February, saying it would subject digital asset companies to the same oversight as traditional finance firms. The government has sought to balance the need to regulate the crypto sector while still establishing Great Britain as a global crypto hub.
“Our robust approach to regulation mitigates the most significant risks, while harnessing the advantages of crypto technologies,” the treasury said in its announcement. “This enables a new and exciting sector to safely flourish and grow, boosting jobs and investment.”
As PYMNTS wrote earlier this year, the U.K. — along with places like Singapore and Hong Kong — is increasingly being viewed as an attractive marketplace for crypto players as the U.S. steps up its regulatory battle against the industry.
For example, venture capital firm Andreessen Horowitz in June announced plans to open a new office in London to support cryptocurrency startups in Great Britain.
Chris Dixon, Andreesen’s general partner and well-known crypto advocate, told the Wall Street Journal that the U.K. offers a more friendly regulatory environment than the U.S..
“We’ve been wanting regulatory clarity for a long time,” Dixon said. “In the U.K., I think it will happen faster because there’s more political will.”
As PYMNTS wrote recently, just two crypto bills have made it past congressional committees in the year since FTX’s collapse, both of which face tough opposition.
Source : PYMNTS / October 30, 2023