Her Majesty’s Treasury in the UK has released a document outlining a series of proposals for the crypto community. With the consultation, the Treasury is initiating a “regulatory approach to cryptoassets and stablecoins” for 2021 following the Brexit turmoil.
Special attention to the regulations for stable currencies
According to the official announcement, the consultation mainly focuses on stablecoins to collect investment and wholesale use. The HM Treasury expects to gather insights from the crypto “industry and stakeholders” until March 21, 2021.
In 2018, the UK government launched a cross-authority task force to assess the impact of a “rapidly evolving cryptoasset market” on the economy.
With such motivation, HM Treasury wants to “ensure that its regulatory framework is equipped to exploit the benefits of new technologies, support innovation and competition, while limiting risks to consumers and stability”.
The Treasury explains in the document why they paid special attention to stablecoins after the launch of the task force:
Two years later, the landscape is changing rapidly. So-called stablecoins can pave the way for faster, cheaper payments, making it easier for people to pay for things or store their money. There is also growing evidence that DLT could have significant benefits for capital markets, potentially fundamentally changing the way they operate.
The government continues to monitor the crypto market to put in place a ‘right’ regulatory approach
According to the document, signed by John Glen, Economic Secretary to the UK Treasury, this approach marks the “first stage in our consultative process” with the crypto industry. They also want to identify ‘where the greatest risk lies’, emphasizing the importance of a risk-driven approach to regulation.
Secretary Glen noted in the document:
The government will continue to actively monitor new and emerging risks as this market matures. We are ready to take further regulatory action to ensure that the market works for the people and businesses that operate there.
On January 11, 2021, the UK Financial Conduct Authority (FCA) warned investors on risky crypto investments and the rise of related scams to the industry.
What do you think of the UK government’s document on the crypto industry? Let us know in the comments below.
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