A new bill that would enable regulators in the UK to oversee cryptocurrencies and stablecoins was approved by King Charles on June 29, 2023, making it an official law.
The ‘Royal Assent’ is a purely procedural step that follows once a law is passed by the lawmakers in the UK Parliament. The Financial Services and Markets Bill Act was approved by Parliament’s upper chamber last week.
UK’s Financial Services Minister Andrew Griffith stated that the Act gave the government control of the “financial services rulebook”, following UK’s exit from the European Union. He also stated that the new law would enable the UK to regulate cryptocurrencies and facilitate their safe adoption by its citizens.
Tabled in July last year, the Financial Services and Markets Bill gives regulators the upper hand over the financial services system, including cryptocurrencies. While the bill was being debated in Parliament, it was amended to consider all cryptocurrencies as regulated activity. The bill also brings the use and sale of stablecoins under its scope.
With the bill becoming a law, the UK’s treasury, the Bank of England, the Financial Conduct Authority, and the Payments Systems Regulator would be able to implement the law and regulate the cryptocurrency sector.
The law comes at a time when the Conservative Government has been keenly looking for ways to turn the UK into a crypto hub and the Treasury has been consulting on proposed rules for the crypto sector since February. In a media interview in April, Griffith had said that the UK would be rolling out new specific rules for the crypto sector over the next 12 months.
So, blockchain innovators in the UK looking to roll out new crypto coins should brace for new regulatory interventions. Another key advantage of the new law is that crypto users would be using these digital assets in a more secure and transparent environment. This is likely to curb common frauds where users are duped with schemes with shady promises like how to make $100 a day with cryptocurrency or misleading information like what is the best time of day to buy cryptocurrency.
What does the new law mean for the crypto sector?
The original Financial Services and Markets Bill had plans to cover only stablecoins but later amendments were added to include the use of cryptocurrencies as a regulated activity. Later, crypto promotional services were also added to the Bill’s ambit.
According to HM Treasury, the law seizes the opportunity that opened up after Brexit and enables the government to customize financial services that suit the requirements of the UK’s markets. The Act will bolster the UK’s competitiveness as a financial services hub while paving the way for better business outcomes. The groundbreaking act will be helping the government to regulate crypto assets and facilitate their safe adoption. It also enables the UK to establish ‘sandboxes’ which will explore and leverage new technologies like blockchain in financial markets.
With the new law, it means that there will be a wider set of laws for crypto users and coin trackers to follow.
Disclaimer: This article was created for informational purposes only and should not be taken as investment advice. An asset’s past performance does not predict its future returns. Before making an investment, please conduct your own research, as digital assets like cryptocurrencies are highly risky and volatile financial instruments.
