A few months back, the UK legislators brand a domestic cryptocurrency market- Wild West, rephrasing its regulation. At that time, experts already issued a warning that such bold move would show disastrous consequences in the Fintech market.
Cryptocurrency Regulations Seems Threatening
The report by the British Business Federation Authority (BBFA) and TodaQ crypto exchange company says,
The efforts by the MPs to announce measures which would need the country’s financial regulator, a Financial Conduct Authority (FCA), to police a crypto sector would come as an outcome in other assets like bonds, stocks, and shares being penalized too.
The initial report by Telegraph says that Patrick Curry, the CEO at BBFA, has an argument that such legislation might show unintentional consequences. Basically, this will result in cryptocurrency exchanges to leave the United Kingdom.
This can also disrupt the reputation of Britain being a hub for the Fintech industry. He also believes that such laws might hamper the cryptocurrency sector innovation because it is still a nascent technology. Additionally, according to Patrick Curry,
It is a very blunt instrument approach and I haven’t seen this in other countries. The use of this technology is still a voyage of discovery and these technologies are being refined for different types of use. My concern is the law of unintended consequences.
The Treasury Committee at British Parliament has the issuance of the cryptocurrency regulation over mid previous month. Moreover, they have major concerns over following
- Minimal protections has given to the investors
- Widespread fraud reports
- Cybersecurity vulnerabilities- cryptocurrency exchanges and money laundering
However, the report by the BBFA warns regarding the disastrous outcomes from announcing cryptocurrency regulations. The Treasury Committee report argues on such move can evolve the liquidity in the sector. Moreover, the chairperson at Treasury Committee, Nicky Morgan argues saying,
If the government decides that crypto-asset growth should be encouraged, appropriate and proportionate regulation could see the UK become a global center for this activity.
At the moment, the authorities are collaboratively working on a proposal regarding new cryptocurrency regulations. Moreover, these authorities are
- The Financial Conduct Authority (FCA)
- The Bank of England
- Her Majesty’s Revenue and Customs (HMRC)