UK Treasury Set to Release Crypto Regulation Framework by July, Aiming to Balance Innovation and Consumer Protection
Summary:
The UK Treasury plans to launch a regulatory framework for cryptocurrencies and stablecoins by July to inspire local development in blockchain technology and digital assets. Disclosed at the Innovate Finance Global Summit 2024, the framework will cover diverse aspects, from exchange operations to customer asset custody. The purpose is to balance business innovation with customer protection. Law amendments also enable UK authorities to seize suspicious crypto assets directly from exchanges and custodian wallets from April 26.
The UK’s chancellor of the Exchequer is set to roll out a legislative framework for cryptocurrencies and stablecoins by July of this year, in an effort to stimulate domestic development of blockchain and digital asset technologies. Bim Afolami, the current financial secretary to the Treasury, revealed the government’s ongoing initiative to revolutionise the nation’s approach to payments at the Innovate Finance Global Summit (IFGS) 2024.
In addition to enhancements to traditional financial payments, Afolami emphasized the critical role of cryptocurrency regulations in maintaining global competitiveness. “True transformation necessitates an effective and forward-thinking regulatory structure for digital assets and stablecoins, ensuring the UK remains the leader of fintech initiatives globally,” he stated.
Afolami further underscored the UK government’s stance on regulation, which is to strike an ideal equilibrium allowing businesses to innovate while ensuring consumer protection. The UK Treasury is ironing out the final drafts that incorporate stablecoin and crypto staking regulations, with delivery scheduled for June or July. The minister explained that: “Upon implementation, this will result in a myriad of crypto asset-related activities, ranging from exchange operations to customer asset custody, being governed by regulatory surveillance for the first time.”
Additionally, Afolami announced the establishment of a task force focused on open finance during the summit. He stated, “This team will develop distinctly defined guidelines, identifying crucial data sets and the necessary commercial incentives to promote the use case of open finance for CFIT SME lending.”
Beginning April 26, UK law enforcement will be authorised to seize crypto assets straight from exchanges and custodian wallet providers. This enactment follows revisions to the Economic Crime and Corporate Transparency Act 2023, which broadens the authority of the National Crime Agency to apprehend and confiscate suspicious, potentially illegal, crypto assets without needing to file extensive legal formalities.
Albeit it didn’t provide details on its process, it's generally acknowledged that cryptocurrencies are made null and void by a process known as 'burning' - this involves transferring tokens to a 'burn' wallet address, effectively removing them from currency circulation.
Published At
4/16/2024 11:49:06 AM
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