The United Kingdom Treasury or otherwise known as Her Royal Majesty’s Treasury has moved to legalize certain stablecoins in the country following a remarkable bearish fall of the TerraUSD (UST) in the past week. According to UK local news the Telegraph, the nation will not be adopting stablecoins that are pegged with algorithms, but those backed with valuable assets.
Investors have in the past week lost confidence in the Terra Network’s stablecoin and native token LUNA, due to the inability of UST to maintain a peg with the US Dollar. Huge losses have been recorded and the facts around the event have been on top headlines ever since.
Amidst this occurrence, HM’s Treasury remains focused on its plans to regulate stablecoins as mediums of payment in the United Kingdom’s territory.
In a media release that was published in January about the conclusions that were reached in a consultation that was done about stablecoins in the UK, the United Kingdom Treasury defined the asset class as “a form of cryptoasset which aim to maintain a stable value relative to other assets.”
In April, the Treasury’s economic secretary, John Glen, while representing the Chancellor in delivering a speech about the future of finance said, “if crypto-technologies are going to be a big part of the future, then we – the UK – want to be in, and in on the ground floor.”
The facts of the recent announcement were captured in the Queen’s speech, noting further that the pegged asset class will be regulated. This is to ensure the safety of users from the insecurities that the blockchain market presents.
Expanding on the Queen’s speech, a spokesman for the Treasury said the legislation that will govern the regulation of stablecoins will be integrated into a bill dubbed Financial Services and Markets Bill.
He noted further that the bill will ensure that a safe environment is created for “issuers and service providers to operate and grow in the UK, whilst ensuring financial stability and high regulatory standards.”
Another nation that has raised concerns about the current bearish fall of the crypto market is the United States.
The secretary of the Treasury, Janet Yellen commented on the event recently, noting that while the recent conditions around the happenings in the crypto market do not pose any threat to the financial market currently, the tides have a potential to change for the negative.