• The UK government has proposed new measures to regulate the crypto industry, targeting financial intermediaries and custodians who store crypto assets on behalf of customers.
• These regulations are intended to promote consumer protection and reduce the risk of loan activities between multiple crypto firms.
• Transparency requirements will also be implemented to ensure digital trading assets are approved and relevant details are published.
UK Proposes Regulation for Crypto Industry
The UK government is stepping forward in a bid to bring more regulation into the cryptocurrency industry. An industry consultation took place on Tuesday which outlined the plans for providing more control over crypto-related businesses, just as traditional financial firms are watched over.
The main targeted aspects proposed to be regulated by the UK government include allowing financial intermediaries and custodians to store crypto assets on behalf of clients. This idea was behind most crashes of crypto businesses last year, including FTX, so the UK is looking to enforce strict regulations on risky loans between multiple crypto firms. These proposals focus on consumer protection, clamping down on loan activities and reinforcing rules around lending of crypto assets while enhancing consumer protection and operational resilience of firms.
To ensure proper enforcement across all sectors in the cryptocurrency industry, transparency requirements will be implemented for digital trading assets as well as precise approval requirements for these trading platforms. This should allow consumers a greater level of confidence when engaging with these companies, knowing that their funds are safe from any potential risks or misappropriation.
Commitment To Grow Economy
Andrew Griffith, economic secretary to the Treasury stated: “We remain steadfast in our commitment to grow the economy and enable technological change and innovation — and this includes crypto asset technology” He added: “But we must also protect consumers who are embracing this new technology — ensuring robust, transparent, and fair standards.”