The UK Government Targets New Legislation for Stablecoins and Staking
The UK government is pushing for swift legislation on stablecoins and staking within the next six months. Bim Afolami, Economic Secretary to the Treasury, emphasized the government’s commitment to enacting regulations during an industry event. The government aims to get lawmakers to approve new legislation in order to address the urgent need for regulation in the crypto sector.
Phased Regulatory Framework for Crypto in the UK
The UK has adopted a phased approach to regulate the crypto industry. The Treasury has already released proposals to oversee fiat-backed stablecoins, with a specific focus on their use in payments. This marks the first phase of regulation, with plans for a broader regulatory framework for the wider crypto asset sector.
- The staged approach allows for targeted attention on stablecoins while laying the groundwork for addressing other dynamics of the crypto landscape.
- Fiat-backed stablecoins will be regulated in two areas: usage in payments and UK-based issuance/storage.
Three Regulators Empowered to Oversee Stablecoins
The Bank of England, Financial Conduct Authority, and Payment Systems Regulator will jointly oversee certain fiat-backed stablecoins under proposed regulations. These suggestions followed a consultation regarding the UK’s forthcoming financial services regulations for crypto assets.
- The response to the regulations has been robust, with feedback from various companies and stakeholders.
- Some view the UK’s regulation proposals as aligning with the vision of fostering a national crypto hub, while others remain cautiously optimistic.
- Treasury Minister Andrew Griffith expressed approval for the stablecoin framework, considering it a step in the right direction.
Hot Take: UK Aims to Regulate Stablecoins and Staking by Mid-2024
The UK government is determined to enact legislation for stablecoins and staking within the next six months. This move is part of the government’s efforts to regulate the crypto industry and address its impact on mainstream finance. By taking a phased approach, the UK aims to focus on stablecoins while also considering the wider crypto landscape. The proposed regulations will empower three regulatory bodies to oversee certain fiat-backed stablecoins. While some stakeholders view these regulations positively, others remain cautious. Overall, the UK’s aim is to establish a comprehensive regulatory framework for crypto assets.
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