On Monday, the UK Government confirmed that it is looking into tighter and more formal controls to manage the cryptocurrency trade. This response followed a consultation paper, framing cryptocurrency regulation recommendations, that was published in February this year.
UK Government looking to tighten control over cryptocurrency
In the follow-up to this initial paper, the Government indicated it plans to regulate several cryptocurrency dealings according to the same rules used for banks and financial services companies. UK Financial Services Minister, Andrew Griffith, said:
I am very pleased to present these final proposals for cryptoasset regulation in the UK on behalf of the Government. I look forward to our continued work with the sector in making our vision a reality for the UK as a global hub for cryptoasset technology.
The UK Treasury indicated it plans to put the relevant legislation on the table in 2024. This includes mandating cryptocurrency exchanges to submit details about admission standards and disclosures when listing new assets. These details could possibly include a token’s underlying codes, identified weaknesses, and associated risks.
The move forms part of a broader government plan that aims to attract and align with more digital-based assets and investment options while protecting consumers. It appears authorities are increasingly recognising the need to formally control cryptocurrency ventures.
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The European Union (EU) approved the Market in Cryptoassets (MiCA) regime, which are broad-spectrum measures regulating digital finances, earlier this year. At present, these rules are the best in the market. Seemingly, the UK plans to follow suit. Griffith further commented:
We must make the UK a place where cryptoasset firms have the clarity needed to invest and innovate, and where customers have the protections necessary for confidently using these technologies.
