The UK’s passing of the bill demonstrates its dedication to both harnessing the potential of cryptocurrencies and safeguarding consumers, solidifying its position as a pioneering global leader in cultivating a vibrant and well-regulated cryptocurrency ecosystem amidst an evolving regulatory landscape.
The UK has officially passed a bill that recognizes cryptocurrency as a regulated financial activity within the country. The bill, known as the Financial Services and Markets Act 2023, has received royal assent and was approved by King Charles on Thursday. This significant development grants regulators the power to govern the cryptocurrency and stablecoin sectors.
The process of royal assent is a necessary step for legislation to become law in the UK. With this final approval, the Financial Services and Markets Bill has now become an Act, marking a crucial moment for the digital asset industry in the country. The government, in a press release, highlighted the act as “central” to its vision of growing the economy and creating an open, sustainable, and technologically advanced financial services sector.
The bill was first introduced in July 2022 and represents a reform of the regulatory framework, expanding the authority of regulators over the finance system. With the new legislation in place, regulators now have the necessary regulatory power to govern the digital asset industry, including cryptocurrencies and stablecoins.
Under the new law, the UK Treasury, Financial Conduct Authority, Bank of England, and the Payments System Regulation Authority will be able to introduce and enforce regulatory rules in the cryptocurrency sector. This will enable the government to exercise control over the financial services rulebook, supporting businesses and consumers while driving growth in the sector.
The UK government has been actively consulting on proposed rules for the cryptocurrency sector since February, aligning with its objective to position the country as a crypto hub. The development of specific rules for the industry is expected to begin soon, with Economic Secretary of the Treasury, Andrew Griffith, stating that they could be implemented within the next 12 months.
This recognition of cryptocurrency as a regulated financial activity represents a significant step towards creating a secure and transparent environment for digital assets in the UK. It provides greater confidence to businesses and consumers alike, ensuring the safe adoption of cryptocurrencies while promoting the growth and innovation of the financial services sector.
The UK is poised to become a leading jurisdiction for cryptocurrency activities with the new regulatory framework in place. The government aims to foster an ecosystem that attracts investment, promotes technological advancements, and facilitates responsible financial practices within the digital asset industry by establishing clear rules and oversight.