UK Could See Live Crypto Regulation Within 12 Months

Crypto-specific regulations are well on their way in the UK, while the US is opting for an enforcement-heavy approach

article-image

ComposedPix/Shutterstock, modified by Blockworks

share

The UK crypto scene should brace for industry-specific regulations to hit within the year.

Andrew Griffith, financial secretary to the UK Treasury, told CNBC in a recent interview that crypto regulations would soon be solidified. “Over the next 12 months or so is the window,” Griffith said.

“We’ve got control back of the rulebook, not something that the UK has had for decades,” he added, referring to Brexit. “So we’ve got the ability to move in an agile and proportionate way and I’m definitely keen we make the most of that opportunity.”

The UK government in February published a consultation paper that proposed rules for crypto, saying it hoped these would manage the “turbulent industry.” 

Among the proposals, the Treasury seeks to require crypto firms already registered with the Financial Conduct Authority to apply for authorization under the new Financial Services and Markets Act-based regime.

Griffith cited the in-progress Financial Services and Markets Bill (FSMB) as part of those incoming regulations.

FSMB, considered a landmark bill which would give regulators greater power over the digital asset sector, was introduced in mid-2022 while UK Prime Minister Rishi Sunak was still chief finance minister. 

UK crypto bill in final stages

The wide-ranging FSMB is pitched as an overhaul of the UK’s regulatory framework, necessary to place the country in a more competitive financial position. It includes regulations for both stablecoins and crypto assets more broadly. 

Lawmakers have pushed for several amendments to the bill. Griffith himself proposed that “cryptoasset” be defined as “any cryptographically secured digital representation of value or contractual rights” that can be transferred, stored or traded electronically and uses blockchain technology.”

Other amendments would broaden the FCA’s oversight of crypto, if FSMB is indeed passed into law, forcing companies to comply with more stringent compliance obligations.

The bill has completed a third reading in the House of Commons. It’s now in the House of Lords, which means all members have the opportunity to make amendments to the bill. Once both houses agree on all aspects, it will be sent to King Charles for it to become law.

Meanwhile, crypto regulation in the US is being led by enforcement, particularly around securities laws. The US House Financial Services Committee however recently published a draft bill on stablecoin regulation that requires providers to maintain liquid reserves backing their coins on at least a one-to-one basis.

Bank of England Deputy Governor John Cunliffe expressed similar sentiment, stressing in a speech this week that stablecoins are one of the bank’s focus areas.

“Systemic stablecoins will need to be backed with high quality and liquid assets to be able to meet these expectations and standards, as set out by the Financial Policy Committee,” he said.


Don’t miss the next big story – join our free daily newsletter.

Tags

Upcoming Events

Hilton Metropole | 225 Edgware Rd, London

Mon - Wed, March 18 - 20, 2024

Crypto’s premier institutional conference returns to London in March 2024. The DAS: London Experience: Attend expert-led panel discussions and fireside chats Hear the latest developments regarding the crypto and digital asset regulatory environment directly from policymakers and experts.

Salt Lake City, UT

WED - FRI, OCTOBER 9 - 11, 2024

Pack your bags, anon — we’re heading west! Join us in the beautiful Salt Lake City for the third installment of Permissionless. Come for the alpha, stay for the fresh air. Permissionless III promises unforgettable panels, killer networking opportunities, and mountains […]

recent research

Research report - cover graphics (1).jpg

Research

In this report, we dive into crypto private market data to gather insights on where the future of the industry is headed. Despite a notable downturn in private raises, capital continues to infuse promising projects that aim to transform payments, banking, consumer experiences, community, and more, with 2023 being the fourth-largest year for crypto venture capital.

article-image

BUZZ holds shares of Coinbase, Robinhood and MicroStrategy

article-image

Opinion: Even though I didn’t pay for my “Diamond Hands” burger with BTC, don’t let that fool you into thinking that crypto’s development is futile

article-image

The results mark “a major positive inflection point,” one analyst says, as the exchange carries net income momentum into a crypto rally

article-image

While the slate of 10 US spot bitcoin funds have tallied $4.6 billion of net inflows thus far, half of the field is lagging the leaders

article-image

Trading volumes totalled $154 billion in Q4, including $125 billion in institutional volume

article-image

DeFi on Bitcoin is all the rage right now and Stacks is positioned to benefit