A bill that aims to regulate cryptocurrencies and
stablecoins in the UK has been approved by King Charles III. Dubbed the Financial
Services and Markets Act 2023, the new law classifies the trading of
cryptocurrencies as a regulated activity and brings stablecoins under the scope
of payment rules.
The Act gives regulators more power to govern financial systems,
including the digital assets industry. The bill, which got the approval of the UK parliament’s upper house
last week, permits regulators, including the Financial
Conduct Authority (FCA), the
Bank of England, and the Payments Systems Regulator, to introduce new rules in
the digital asset sector.
Andrew Griffith, the
Economic Secretary to the Treasury, said that the new law presents an
opportunity to tailor the regulation of financial services to the UK market as the country is no longer part of the European Union (EU). Additionally, the law is expected to enhance the scrutiny and accountability powers of financial regulators.
“This landmark
piece of legislation gives us control of our financial services rulebook. It
supports the UK businesses and the consumers, and drives growth,” Griffith said in a statement.
“By repealing old EU laws set in Brussels, it will unlock billions in
investment cash that can unlock innovation and grow the economy.”
Through the new
legislation, the UK expects to promote safe adoption of cryptocurrencies in
the country. It further expects to create a framework to facilitate
the testing of new technologies like blockchain in the
financial markets, the HM Treasury elaborated in the statement.
UK Curbs Crypto
Promotions
The original version of the comprehensive bill was
introduced in July last year and was proposed to regulate stablecoins under the
payments services rules. However, as the bill progressed through parliament, the
amendment to treat crypto trading as a regulated activity was introduced.
Additionally, measures to control the promotion of digital assets
were later included.
Griffith said in an
interview with CNBC in April that the specific rules for cryptocurrencies could
be introduced within a year. According to Griffith, this step is part of an
agenda to establish the UK as a global hub for cryptocurrency technology.
Meanwhile,
Finance…
