Charting a Course for Crypto in Post-Brexit Britain
In a revolutionary move on Thursday, the United Kingdom formally endorsed a law to oversee the regulation of cryptocurrencies and stablecoins. This move is a significant stride in the nation’s broader financial regulatory adjustments following Brexit.
Named the Financial Services and Markets Act, this groundbreaking legislation endows regulators with the powers to devise a bespoke framework for the burgeoning digital asset industry, thus fostering a safer adoption ecosystem in the UK. The announcement came from an official UK Treasury press release.
A Global Crypto Powerhouse
This enactment is in line with the UK government’s aspiration of transforming the nation into a leading global hub for cryptocurrencies.
Earlier in February, the UK Treasury initially announced its intent to elucidate crypto regulations for consumers and businesses. Originally, the plan was to regulate digital assets in a manner similar to traditional finance, but it was met with resistance from prominent parliamentarians who insisted on a gambling-like regulation for cryptocurrencies.
Paving the Way for Blockchain Experimentation
The freshly passed legislation, having successfully navigated the last stage of parliamentary process, proposes the establishment of “regulatory sandboxes”. These will be instrumental in fostering additional trials with blockchain technology within the business sphere.
Ensuring Regulatory Oversight of Stablecoins
Moving beyond conventional cryptocurrencies, this innovative act includes stipulations recognizing stablecoins — digital tokens pegged to traditional fiat currencies — as an acceptable payment method.
During the Act’s parliamentary scrutiny stages, modifications were adopted to categorize all cryptocurrencies as regulated activities. This change provides regulators with the power to oversee promotional activities related to cryptocurrencies.
Applause from the Treasury
Andrew Griffith, UK’s Economic Secretary to the Treasury, extolled the merits of this act. In his words, it’s a “landmark piece of legislation” which reasserts the national government’s control over the “financial services rulebook”.
