April 19, 2024
UK's Clearer Crypto Regulations by July
Latest Cryptocurrency News

UK’s Clearer Crypto Regulations by July

In a bid to foster local innovation in digital assets and blockchain technology, the United Kingdom Treasury is set to unveil a regulatory framework for crypto assets and stablecoins by July. This announcement was made by the UK’s economic secretary to the Treasury, Bim Afolami, during the Innovate Finance Global Summit (IFGS) 2024.

Emphasis on Global Competitiveness

Afolami underscored the significance of crypto regulations in maintaining global competitiveness, alongside the UK’s focus on enhancing fiat payment innovation. He stressed the government’s commitment to striking the right balance between fostering innovation and safeguarding consumers’ interests.

“Speaking of true change, I know that the cornerstone of our position as a world leader in fintech is the delivery of our regulatory regime for crypto assets and stablecoins.”

Proposals and Task Force Formation

The UK Treasury is currently fine-tuning proposals concerning stablecoin and crypto staking regulations, slated for delivery by June or July. Additionally, Afolami announced the establishment of an open finance task force aimed at crafting recommendations to drive forward the use case for open finance, particularly focusing on SME lending. The minister added:

“Once it goes live, a whole host of crypto asset activities including operating in exchange taking custody of customer assets and other things will come within the regulator perimeter for the first time.”

Legal Amendments and Enforcement Measures

Effective April 26, UK authorities will gain the ability to directly access crypto assets from exchanges and custodian wallet providers. This legislative change stems from amendments to the Economic Crime and Corporate Transparency Act 2023. The amendments expand the National Crime Agency’s authority to confiscate and seize crypto assets suspected of involvement in illicit activities without requiring extensive legal procedures.

The Economic Crime and Corporate Transparency Act 2023. Source: U.K. Parliament

Cryptocurrency Destruction Process

Although the article did not detail the specific process, the common method of destroying a crypto token involves “burning” it. This entails transferring the tokens to a designated burn wallet address, effectively removing them from circulation.

The UK’s proactive approach towards regulating crypto assets and stablecoins underscores its commitment to fostering innovation while ensuring the integrity and security of financial systems. This initiative aligns with broader global trends toward establishing clear regulatory frameworks for the burgeoning cryptocurrency sector.

Image by gpointstudio on Freepik

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