The United Kingdom plans to introduce new legislation targeting crypto-stakes and stablecoins by July, as stated by Bim Afolami, economic secretary at the Innovate Finance Global Summit in London. Afolami emphasized the government’s swift efforts to finalize and implement the regulatory framework.
He emphasized that the upcoming legislation will bring a variety of crypto-asset activities under regulation for the first time. These activities include, among others, the operation of cryptocurrencies and the management of the custody of clients’ assets.
Afolami intends to introduce Stablecoins legislation “as soon as possible”.
The UK government’s announcement of nearly completed legislation follows its revised stablecoins regulations in October 2023. The regulations aim to reduce the risk of harm to consumers and address the behavioral, prudential and financial stability risks associated with stablecoins to speak
With an election expected later this year, the current Conservative government may face challenges in implementing its long-term financial regulatory plans for the cryptocurrency sector.
Currently, the Labor Party has a significant lead over the Conservative Party, with polls from April 2024 indicating a 65% disapproval rating for Prime Minister Rishi Sunak. Sunak, a staunch proponent of cryptocurrencies and a former analyst at Goldman Sachs, has been outspoken about his ambitions to position the UK as a central hub for the cryptocurrency industry.
At a cryptocurrency event in February 2024, Afolami previously indicated that the government is urgent to introduce legislation on stablecoins, stressing the need to act quickly.
The FCA plans to crack down on market abuse in the cryptocurrency sector
The UK government quickly implemented several policies affecting the cryptocurrency industry, culminating in the passage of the Financial Services and Markets Bill (FMSB) in June 2023.
The UK’s Payment Service Regulator (PSR), an independent subsidiary of the Financial Conduct Authority (FCA), explained that the law expressly provides for the regulation of payment systems that handle stablecoins.
In March, the FCA announced its intention to tackle market abuse in the cryptocurrency sector by improving its market oversight and developing sophisticated analytical tools.
🇬🇧🚨🇬🇧🚨🇬🇧 LONDON IS READY 🇬🇧🇬🇧
👤 @BimAfolami, MP and Economic Secretary to HM Treasury outlines legislation being developed to regulate #stablecoins and #striking, with plans to finalize proposals by their summer recess (🗓 24th July) 💥
On… pic.twitter.com/GAkBLWAbn4
— Subjective Views (@subjectiveviews) April 15, 2024
This recent regulation on digital assets by the UK coincides with efforts by US lawmakers to introduce similar legislation on stablecoins.
U.S. Representatives Maxine Waters (D-CA) and Patrick McHenry (R-NC) are leading these efforts. They are considering attaching stablecoins regulations to a larger, mostly unrelated bill to garner bipartisan support.
However, it remains uncertain whether this legislative strategy will succeed before the US presidential election in November.
FATF shows that less than 30% of the world’s jurisdictions regulate the crypto industry
In February, the UK Treasury outlined new regulations for the cryptocurrency industry, proposing that digital asset companies be regulated in the same way as traditional financial institutions. The government aims to regulate the burgeoning sector, while positioning Great Britain as a major global center for cryptocurrencies.
The Treasury emphasized in its announcement that its strict regulatory approach reduces significant risks and capitalizes on the benefits of crypto-technologies. This strategy is designed to allow the emerging sector to flourish safely and thus stimulate job creation and investment.
Despite these efforts, a significant portion of the cryptocurrency sector remains largely unregulated. A recent Financial Action Task Force (FATF) report indicated that less than 30% of global jurisdictions have implemented regulations for the industry.
T. Raja Kumar, head of the FATF, expressed that virtual assets tend to migrate to less regulated areas, which can be exploited by criminals and terrorists for regulatory arbitrage. He emphasized the critical need for a strong regulatory framework across all jurisdictions to prevent such abuses.
Furthermore, a report last month from the FBI’s Internet Crime Complaint Center (IC3) revealed that in 2023, more than 43,000 complaints were filed by Americans regarding cryptocurrency scams, with financial losses from such fraud and scams reaching $3 .9 billion, marking a 53% increase. of the previous year.
Disclaimer for Uncirculars, with a Touch of Personality:
While we love diving into the exciting world of crypto here at Uncirculars, remember that this post, and all our content, is purely for your information and exploration. Think of it as your crypto compass, pointing you in the right direction to do your own research and make informed decisions.
No legal, tax, investment, or financial advice should be inferred from these pixels. We’re not fortune tellers or stockbrokers, just passionate crypto enthusiasts sharing our knowledge.
And just like that rollercoaster ride in your favorite DeFi protocol, past performance isn’t a guarantee of future thrills. The value of crypto assets can be as unpredictable as a moon landing, so buckle up and do your due diligence before taking the plunge.
Ultimately, any crypto adventure you embark on is yours alone. We’re just happy to be your crypto companion, cheering you on from the sidelines (and maybe sharing some snacks along the way). So research, explore, and remember, with a little knowledge and a lot of curiosity, you can navigate the crypto cosmos like a pro!
UnCirculars – Cutting through the noise, delivering unbiased crypto news
