UK government to unveil plans to regulate crypto

01 Feb 2023

The UK government is set to announce a series of measures to regulate the cryptocurrency industry.

The proposals, due to be published on Wednesday, will boost consumer confidence and allow the sector to “thrive,” BBC reports.

The Treasury said on Tuesday the proposals put forward are designed to “regulate a broad suite of crypto asset activities, consistent with its approach to traditional finance”. In addition, it said it would reverse a prior pledge to parallel the regulation of cryptocurrency promotions with the same standards applied to stocks, shares and insurance products, the Financial Times states.

The news follows a turbulent year for the crypto industry, involving the collapse of the FTX exchange, stablecoin issuer Terra and plummeting crypto values. Indeed, the value of the 500 biggest crypto assets declined $1.7 trillion in 2022. 

As such, global regulators have been calling for more regulations for the industry. 

“We remain steadfast in our commitment to grow the economy and enable technological change and innovation – and this includes crypto asset technology,” said Andrew Griffith, economic secretary to the Treasury. “But we must also protect consumers who are embracing this new technology - ensuring robust, transparent, and fair standards.”

As it stands, crypto activity is not regulated by the UK’s Financial Conduct Authority, yet digital asset service providers operating in the country must go through the FCA’s anti-money-laundering review process, the FT report adds. 

The government’s consultation on the proposals will come to an end on 30th April, and ministers will then consider any responses. Once legislation is to put to parliament, the Financial Conduct Authority will then devise the rules to be followed within the sector.

deVere CEO and founder Nigel Green has long been a proponent of cryptocurrency regulation: “A robust, regulatory framework will help to protect investors, strengthen the sector itself, tackle crypto criminality and reduce the likelihood of disrupting global financial stability, not to mention providing a potential long-term economic boost to those countries which introduce it.”