The UK has published its first consultation on crypto trading and credit regulation in the country.
The UK has released plans to regulate the cryptocurrency industry in the country.
The announcement highlighted that “the high level of volatility and several recent failures have exposed the structural vulnerability of some business models in the sector,” among other reasons, have led to new regulatory guidelines.
Focusing specifically on trading and lending, the report describes how the UK government “will seek to regulate various cryptoasset activities, consistent with a traditional financial approach.” It details how the proposals will give responsibilities to cryptocurrency exchanges and companies to establish detailed content requirements for disclosure documents, taking “fair” standards. To ensure the safety of customer funds, the consultancy will create a framework with clear guidelines on responsible practices.
“We remain steadfast in our commitment to growing the economy and enabling technological change and innovation – and this includes cryptoasset technology,” said Economic Secretary to the Treasury Andrew Griffith.
The consultation also highlighted the need for cryptocurrency custodial actors and intermediaries to facilitate transactions responsibly and keep customer assets safe. This is especially important due to recent events throughout the cryptocurrency space that have left millions of customers without access to their funds.
Today’s consultation will end on 30 April 2023, after which the government will consider feedback and formulate a response. “Once the legislation is established, the Financial Conduct Authority will consult on detailed rules for the sector,” the announcement said.