The market bloodbath triggered widespread regulatory scrutiny of the crypto industry. This did not deter the group from looking to explore the digital asset space and making recommendations for the way forward.
According to reports, a coalition of parliamentary groups in the United Kingdom is researching cryptocurrency.
The group wants to determine the suitability of the current rules and chart a way forward. The Crypto and Digital Assets All-Party Parliamentary Group (APPG) plans to release a policy report for further implementation.
The UK Parliamentary Group Launches Crypto Research
Digital assets are among the most discussed and debated topics of interest to many people lately. And the UK group is now among the ones researching the merits of the adoption of cryptocurrency.
Reports indicate that the group seeks expert input from all stakeholders in the crypto industry. It seeks to know whether the current regulatory approach employed by the UK and central bank digital currency (CBDC) can enhance transactions.
According to Lisa Cameron, a Scottish National Party member of parliament and head of the group, knowing what is amiss is vital.
Cameron noted that it is important that the UK does not keep the regulation of the industry aside. The government and its agencies must show commitment when it comes to overseeing the activities of the digital asset space.
However, the UK is among those countries that have sped up their regulatory efforts in this industry. It wants to create comprehensive guidelines to oversee the rising adoption of digital currencies in transactions.
Cameron noted that the country had done remarkably well in regulation but could not afford to step off the gas.
The UK’s EU Approach
The UK Treasury in February released a statement indicating its readiness to act fast to maintain its status as a crypto hub. It will do this by having a holistic crypto regulatory framework for the country.
Furthermore, the statement revealed that the regulatory framework would be modeled after the European Union’s MiCA regulations. The market in crypto assets (MiCA) is the EU’s rules and regulations developed to ensure compliance across the blocs. Member states will implement a uniform law to regulate their crypto spaces.
Thus, the UK’s Treasury regulatory framework is set to have a functional approach in line with existing regulations.
Meanwhile, insider sources disclosed that the UK regulatory approach is heavily tilted toward stablecoins, which the government already has in mind. The government has been consulting with experts since 2020, indicating why the priority will be on stablecoins.
Some regulatory measures will cover license approval for service providers, capital and liquidity requirements, and reserve assets.
However, analysts point out that knowing your customer (KYC) and anti-money laundering requirements will favor the big crypto exchanges. This is because they have the financial muscle and infrastructure to meet the regulatory requirements.
So far, the UK does not consider digital assets as currency for transactions, nor do they see them as a commodity. As a result, the industry is regulated in different ways.
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