UK government advocates for crypto by implementing new regulatory framework

UK government advocates for crypto by implementing new regulatory framework

Time Stamp: June 21, 2023 8:00 AM
  • The UK government has openly advocated for its rapidly growing crypto market and installed over 230 ATMs for digital currencies in the UK.
  • On the 19th of June, the Parliament’s upper chamber, the House of Lords, approved the FSMB.
  • The crypto rate in the UK thrived, giving a projected market of $1.86 billion by the end of the year.

Since the FTX crash, multiple regulatory bodies have reassessed their take on digital currency. In Africa, most governments have softened their take on digital asset adoption. Some have claimed to deploy research teams to research how best to implement digital currency, while others remain silent. Unfortunately, the same thought process is not shared among the global audience as most crypto regulatory bodies seek to tighten crypto regulation frameworks. Pioneered by the US SEC, many recognize they must apply harsh rules for crypto to succeed. Among the chaos, a rising notion has steadily gained traction; crypto in the UK. The UK government has announced it may introduce new laws regulating crypto adoption. The Finacial Service and Market Bill now recognize crypto as a regulated activity. Furthermore, the FSMB has stated that stablecoin might provide a new payment medium under existing laws.

The state of crypto in the UK

The UK government is among the few who have truly embraced the concept of digital assets. The country has one of Europe’s few steadily increasing crypto trading volumes. In December 2019, as the UK steadily adopted crypto, the country’s trading volume significantly shot from 3.0% to 5.35%.

Despite the modest growth rate of crypto in the UK, males initially dominated the franchise. According to Gemini’s research in 2020, 13.5 of respondents had dived into digital assets and innovations. This presented a 15% increase from the previous study handled by the UK government in 2019.

Also, Read Binance Exchange calls out the recent SEC crackdown on crypto.

Unfortunately, the crypto ecosystem began showcasing more theft issues and fluent activities. The Financial Conduct Authority finally released a notice banning the sale of crypto derivatives. This new ban, however, only affected crypto derivatives that derive their value from an underlying asset such as Bitcoin or Ethereum.

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Crypto in the UK has gained much audience as the government has advocated for its adoption.[Photo/Decrypt]

The crypto rate in the UK thrived, giving a projected market of $1.86 billion by the end of the year. According to Statista, with the current at which the UK adopts crypto, the revenue is expected to show an annual growth rate of 18.83%. This would result in a projected total of $3.77 billion by 2027.

Crypto in the UK has grown prominent, having 3.3 million traders by 2021. 

Bitcoin is the most dominant crypt coin, accounting for almost 60% of the region’s market share. The UK government has openly advocated for its rapidly growing crypto market and installed 18 ATMs for digital currencies in the UK. These crypto ATMs are distributed in London(14), Birmingham(3), Cardiff(1) and Manchester(1).

Unfortunately, the recent crisis made it clear to the governments and the FSMB that better crypto regulations were needed.

Crypto in Uk gains additional regulations.

The UK government has finally reached a consensus and voted for a new bill recognizing crypto as a regulated activity in the country. On the 19th of June, the Parliament’s upper chamber, the House of Lords, approved the FSMB. This means the bill finally undergoes its final stages before officially becoming law. 

Also, Read Crypto adoption growth demands improved infrastructure in Africa.

Introduced in July 2022, this newly proposed crypto regulation framework spans 340 pages. Initially, its drafters intended for the FSMB to regulate stablecoins under the country’s existing payment rules. After further amendments, the bill will be able to view crypto as a regulated activity to supervise all crypto promotions within the region.

The UK government wants the FSMB to give regulators the legal power to set efficient crypto regulation frameworks without hindrance from other officials. Baroness Joanna Penn claimed, “This bill delivers the outcomes of the future regulatory framework review, giving the regulators significant new rulemaking responsibilities whilst balancing that additional responsibility with clear accountability, appropriate democratic input, and transparent oversight.”

Conclusions.

If the UK adopts crypto, it would effectively calm the current storm within the ecosystem. The US has proven to be an uninhabitable ground for any crypto-related activity. Since the SEC began implementing hash crypto regulation frameworks, most industries have avoided the US completely or shut down their US branches.

With most exchanges now looking for alternatives, this new development increases crypto usage in the UK. Due to its initial positive talk of the industry, the UK offers both the market and the facilities desirable by most exchanges.

Also, Read Crypto Innovation: Locating and Using Bitcoin ATMs in East and West Africa.

Fortunately, according to Economic Secretary to the Treasury Andrew Griffith, a standard and operating crypto regulation framework could come within 12 months of the FSMB implementation. Once the KIng approves o this new bill, crypto might have a fighting chance to sustain its highly volatile state.

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