UK Crypto Firms Might Come under Prudential Rules as FCA Designs Policy

The UK
Financial Conduct Authority (FCA) in its latest annual report for the year
ended March 31, 2023, said it
continues to design
prudential requirements for firms that are carrying out activities involving
crypto assets. However, the British watchdog noted that it will only initiate
public consultation on the rules after it gets the backing of the government
and lawmakers.

Prudential
requirements are rules and regulations that are designed to ensure the
financial stability of financial establishments. These requirements typically
focus on capital adequacy, liquidity
Liquidity

The term liquidity refers to the process, speed, and ease of which a given asset or security can be converted into cash. Notably, liquidity surmises a retention in market price, with the most liquid assets representing cash.The most liquid asset of all is cash itself.· In economics, liquidity is defined by how efficiently and quickly an asset can be converted into usable cash without materially affecting its market price. · Nothing is more liquid than cash, while other assets represent

The term liquidity refers to the process, speed, and ease of which a given asset or security can be converted into cash. Notably, liquidity surmises a retention in market price, with the most liquid assets representing cash.The most liquid asset of all is cash itself.· In economics, liquidity is defined by how efficiently and quickly an asset can be converted into usable cash without materially affecting its market price. · Nothing is more liquid than cash, while other assets represent
Read this Term, and risk management.