On Wednesday, the United Kingdom parliament tabled the Financial Services and Markets Bill. The bill is meant to preserve the status of the UK as a leading financial hub after Brexit. The bill is comprehensive, and it looks at different areas in the financial sector.
UK plans to regulate crypto and stablecoins
The comprehensive bill talks about reforming the country’s insurance laws and supporting the victims of financial fraud. It also looks at the global financial sector’s growth and competitiveness while implementing regulations for stablecoins.
The regulation for stablecoins within the bill was outlined by the Chancellor of the Exchequer, Nadhim Zahawi. Stablecoins have been a part of this bill since it was incepted, but they have become a crucial matter because of the recent events unfolding within the crypto space.
Moreover, the turbulent political climate in the UK has also seen some pro-crypto legislatures leaving the government. Those who have resigned include the Economic Secretary to the Treasury, John Glen, and the former Chancellor of the Exchequer, Rishi Sunak.
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The Financial Services and Markets Bill is an extension of the Banking Act of 2009 and the Financial Services Act of 2013 that focuses on digital assets. Under this bill, the US Treasury must regulate digital settlement assets (DSAs) and any payments made with DSA service providers.
The Financial Conduct Authority (FCA), the Bank of England and other regulatory agencies will enforce the digital assets’ regulations. The FCA currently has authority over the crypto space in the UK and has approved several crypto firms. However, acquiring the needed license has been a hectic process.
Before this bill is implemented into law, it has to undergo two more readings within the House of Commons. It will also pass through the committee report stage before being passed on to the House of Lords, where a similar process will be followed.
Crypto regulations in the UK
While some legislatures have pushed for crypto adoption to transform the UK into a crypto hub, some have called for more strict regulations. The Deputy Governor of the Bank of England, Jon Cunliffe, has called for more regulations in the cryptocurrency space.
Cunliffe has previously said that the lack of adequate regulations in the crypto space was like an “unsafe aeroplane.” He also pointed to the recent collapse of protocols such as Terra LUNA.
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