- On Wednesday, the UK Treasury released the consultation document and asked for feedback from experts in the field.
- A regime for crypto lending platforms is one of the proposed rules.
- One of the prime reasons for the urgent demand for new rules and regulations has arisen from the FTX collapse.
When it involves establishing a foundation in cryptocurrency regulation, the United Kingdom needs to catch up. The UK, which was once a member of the EU, is still considering consultation while the EU is close to passing the Markets in Crypto Asset Regulation (MiCA) bill.
This might encourage the government to push the Financial Services and Markets Bill forward as well.
United Kingdom Seeks Additional Regulations
His Majesty’s Treasury is asking for feedback from industry experts in a consultation paper that was published on Wednesday. In addition to making the UK a crypto hub, their feedback will be used to strengthen the regulations that are specifically geared toward consumer protection.
The importance of enhancing market integrity and operational resilience of crypto firms has been highlighted among the new proposed regulations. The new regulations will also target financial intermediaries in order to build a framework for crypto lending. Andrew Griffith, the Treasury’s economic secretary, stated the following in a press release :
“We remain committed to our goal to improve the economy and support technological change and innovation, which includes crypto asset technology. Nevertheless, we must also safeguard consumers who are adopting this new technology by establishing strong, transparent, and fair standards.”
The immediate consideration of introducing new regulations for the cryptocurrency industry has been mostly due to the collapse of the cryptocurrency exchange FTX and its 130 affiliated companies.
The Financial Services and Markets Bill, which is soon to be introduced, is likely to include these regulations. The bill, that’s going to be put to a vote in April, aims to strengthen cryptocurrency regulation in the country.
Additionally, the Treasury declared that, as long as the discussions go on, it will permit any cryptocurrency company registered with the country’s financial regulator to promote itself. This happened despite the UK’s strict stance on cryptocurrency promotion.
MiCA is approaching.
The United Kingdom’s former home, the European Union, is getting closer to implementing MiCA, a bill that regulates cryptocurrency. The licensing of cryptocurrency companies, which has become an important component of the space, will be a major focus of this bill.
Another member of the Bloc, France, adopted the proposal to move the deadline for registering cryptocurrency firms to January 2024 earlier this month in an effort to reduce exploitation of the MiCA regulation.
This will safeguard the country from companies exploiting MiCA’s grandfather clause, which exempts them from acquiring a full license by 2026.
UK Cryptocurrency Bill Will Restrict Foreign Services