The UK Finance Ministry has proposed new regulations for several aspects of the cryptocurrency industry and is seeking public comment.
His Majesty’s Treasury is set to release a highly expected consultation, in which it solicits feedback from industry members and experts on regulations aimed at safeguarding consumers and aligning with the country’s aims to become a centre for crypto.
The Treasury stated that certain measures would put additional onus on crypto exchanges to establish and explain standards for admittance and disclosure papers.
The proposed laws provide a framework for the lending of crypto assets, including regulating the activities of financial intermediaries like custodians. To better ensure market integrity, consumer protection, and business resilience, the Treasury is soliciting feedback on a proposed market abuse framework. Additionally, crypto firms will be subject to stricter prudential and data reporting regulations.
After the collapse of FTX and Terra, regulators throughout the world are demanding for more oversight of the cryptocurrency sector.
In a news statement, Treasury economic secretary Andrew Griffith said, “We remain steadfast in our commitment to grow the economy and enable technological change and innovation – and this includes crypto asset technology. But we must also protect consumers who are embracing this new technology – ensuring robust, transparent, and fair standards.”
In the meanwhile, the European Union is nearing final approval of its groundbreaking Markets in Crypto Asset law, which places a premium on stablecoins and establishes a licensing regime for service providers.
U.K. lawmakers are now debating the Financial Services and Markets Bill, which may strengthen the authority of crypto authorities if passed. The bill is likely to be finalised in April.
Meanwhile, local crypto businesses have been asking for guidance on how to operate. Concerns were voiced by the industry about how it should manage crypto advertising and promotion, which the forthcoming guidelines made clear would require prior clearance.
The Treasury announced that it will introduce a time limited exception to allow crypto asset enterprises registered with the U.K. ‘s financial regulator under its anti-money laundering framework to issue their own promotions while the industry waits for new guidelines.
The consultation period ends on April 30, at which point the government will review the responses and begin formulating a response.