Finances-Friendly Environment in U.K. – Not Scared By The Rise of CryptocurrencyAugust 17, 2019
Britain sustained a finances-friendly environment centered around the City of London; however, the U.K. has been less welcoming in the case of cryptocurrency when compared to traditional finance. Suspicion towards cryptocurrency and the lack of regulatory clarity has been one of the reasons why the growth of cryptocurrency in the U.K. is not doing as well as it actually should have been.
Cryptocurrency trends in the U.K. are changing as the Financial Conduct Authority (FCA) is beginning to update its guidelines on the cryptocurrencies. A series of regulations concerning the cryptocurrency is due towards the end of the year.
The current regulatory environment though in its primordial stage, will go a long way in ensuring a standardized regulated environment, eventually establishing a situation where the general public and the investors will feel that the crypto is safe.
When it comes to its position among the rest of the world in the cryptocurrency leader board, U.K. rests in the middle and the upper ranges in terms of standards and executions in the regulatory ranking. The U.K. does not have any specific regulation targeting the cryptocurrency industry. It has been lenient towards the crypto despite several officers having outright bad opinion on the Bitcoin (BTC) and other digital currencies.
The U.K. has not banned cryptocurrency either generally or any tokens specifically. Further, no strict financial laws of the U.K. are applied to existing cryptocurrencies. The financial giants and other regulators in the U.K. did not come down slowly on the cryptocurrency; until date, they did not strictly believe that the industry has been strict enough to institute regulatory measures.
Mark Carney, Bank of England Governor stated during March 2018 that “the market for cryptocurrencies is not a threat to U.K. financial stability.” He further said, “Crypto-assets do not pose any kind of material risks to financial stability. Looking ahead, financial stability risks could rise if retail participation significantly increases or if there are no material improvements in market integrity, anti-money laundering standards, and cyber defenses.”
Lawmakers and British Authorities have not been scared by the rise of cryptocurrency and the Government and Her Majesty’s Revenue and customs have been comfortably taxing the cryptocurrency revenue of crypto-related business per the existing tax regime.
Given the lack of specific regulations or laws and the existing regulatory uncertainties, it is necessary for a well-designed regulatory regime for crypto assets in the U.K. The U.K. government has been positive about crypto and countries like Japan and Switzerland have taken a healthy initiative.