On Wednesday, the UK Parliament tabled the Financial Services and Markets Bill. The bill aims to preserve the UK’s status as a leading financial center after Brexit. The bill is comprehensive and covers different areas of the financial sector.
UK plans to regulate crypto and stablecoins
The full bill talks about reforming the nation’s insurance laws and supporting victims of financial fraud. It also examines the growth and competitiveness of the global financial sector while implementing regulations for stablecoins.
The regulation of stablecoins in the bill was describe by the Chancellor of the Exchequer, Nadhim Zahawi. Stablecoins have been part of this bill since its inception, but have become a hot topic due to recent events unfolding in the crypto space.
Additionally, the turbulent political climate in the UK has also seen some pro-crypto legislatures leave government. Among those who have resigned are Economic Secretary to the Treasury John Glen and former Chancellor of the Exchequer Rishi Sunak.
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The Financial Services and Markets Bill is an extension of the Banking Act 2009 and the Financial Services Act 2013 which focuses on digital assets. Under this bill, the US Treasury must regulate digital settlement assets (DSAs) and all payments made with DSA service providers.
The Financial Conduct Authority (FCA), Bank of England and other regulators will enforce digital asset regulations. The FCA currently has authority over the crypto space in the UK and has approved several crypto companies. However, acquiring the necessary license was a hectic process.
Before this bill becomes law, it must go through two more readings in the House of Commons. It will also go through committee report stage before being sent to the House of Lords, where a similar process will be followed.
Crypto Regulations in the UK
While some legislatures have pushed for crypto adoption to turn the UK into a crypto hub, some have called for tougher regulations. Bank of England Deputy Governor Jon Cunliffe has called for more regulation in the area of cryptocurrencies.
Cunliffe has previously said that the lack of proper regulations in the crypto space looks like a “dangerous plane”. He also pointed to the recent collapse of protocols such as Terra LUNA.
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