As part of a concerted effort to make the UK the center for crypto assets technology and innovation, the government through the Treasury has announced its plan to regulate cryptocurrencies, and allow stablecoins to become a legal means of payment. It will also create its own Non-Fungible Token (NFTs) as it plans to maintain a crypto-friendly environment.
The announcement was made on Monday by John Glen, Economic Secretary to the Treasury in a keynote speech at the Innovative Finance Global Summit at Fintech week 2022.
Stablecoins, unlike other volatile cryptocurrencies like Bitcoin (BTC), have a stable value tied to Fiat currencies like the United States dollar or assets such as gold. With the right regulations, Glen believes stablecoins will prove to be a more efficient form of payment while instilling the confidence in consumers and businesses alike to plan and invest in the long term.
The UK’s plan for crypto
Glen also assured that the regulations would not be stiff or rigid as an engagement group comprising of leaders in the industry and regulators chaired by him in addition to “CryptoSprints” have been organized by the Financial Conduct Authority (FCA) to receive inputs from the industry players to inform its policymaking. He further reiterated that having the right regulations will help maximize the potential inherent in the crypto ecosystem.
The government also plans to rework the taxation laws on crypto to effect specific changes to eliminate disincentives for UK fund managers and support home-based blockchain innovation in hopes of making the UK the choice for firms without a settled base yet.
Glen in the address also confirmed that Rishi Sunak the UK’s Chancellor has urged the Royal Mint – a government-run mint that produces coins for the UK to design its own NFTs to be launched later in the Summer as an indication of the “forward-looking approach” the government intends to adopt.
This announcement by the government is coming on the heels of requests by various players in the industry for lawmakers and regulators to make clearer laws and regulations regarding digital assets.
Amidst fears that the cryptosphere provides a safe haven for various illegal activities, regulatory authorities are tasked with crafting workable rules for the space and subsequent adoption in order to partake in the potential in the space as opposed to an outright ban.
In the same vein, the Vietnamese government last week tasked its Ministry of Finance with the development of a regulatory framework for engagements in the digital assets in the nation as reported by cryptomarketsbeat.com, a move that now suggests nations are becoming more deliberate about crypto regulations.