UK Government Set to Regulate Cryptocurrency; Says Treasury Minister

The UK Government has announced that it will regulate cryptocurrency to manage the numerous risks associated with the industry. This announcement is coming after the Treasury Minister estimated that up to 10% of UK adults now own some form of crypto. 

According to the minister, the measures which will be captured in the regulation are aimed to “mitigate the most significant risks” of crypto technologies, while “harnessing their advantages”. 

In 2022, the UK Prime Minister, Rishi Sunak, who was then Treasury Minister, said he wanted to make the UK “a global hub for crypto-asset technology.

The regulation proposal which was unveiled today was designed to address exigencies issues that might accompany cryptocurrency such as the collapse of FTX Exchange which hurt many cryptocurrency traders. 

Investors King learnt that the regulation plans to oversee the entire crypto industry in the United Kingdom, with proposals on stronger rules for trading brokerage, crypto lending, and new token issues among others. 

Meanwhile, the news of the potential regulation is perceived differently among the crypto community in the United Kingdom. While some welcomed the development as a step to corporate acceptance, others viewed it as a systematic crackdown on the crypto industry. 

It would be recalled that the United Kingdom had ab initio maintained a mixed policy on cryptocurrency due to the high rate of fraud associated with it. 

The UK government also created a dedicated crime unit for the crypto sector to track cryptocurrency-related fraud while the government also launched a massive crackdown on ‘misleading’ cryptocurrency ads. 

In 2021, crypto ads flooded London’s underground rail network and buses amid the growing interest in bitcoin and other digital currencies.

However, with the potential introduction of the proposed regulation, the UK crypto industry will function alongside the traditional financial market. It will also enjoy more clarity, confidence and consumer protection. 

It is believed that the regulation which will put cryptocurrency under the mainstream financial market will usher in a number of investors from the traditional market. Thereby, leading to more capital inflow.