The UK Finalizes Regulations on Cryptocurrency Industry

• The UK Treasury is finalizing plans to regulate the cryptocurrency industry, which will include a package of extensive new rules.                             
• Crypto industry leaders have long called for a more-comprehensive framework in the UK, similar to the European Union’s Markets in Crypto-assets.

The UK treasury is in its final stage of finalizing regulations for the cryptocurrency sector. The new regulatory regime comes in with limits for foreign companies and provisions on how to handle a collapse of companies in case of another FTX tragedy.

The government will soon launch consultation sessions on the new regulatory regime. Ministers are to take part in the consultation on Wednesday, on the same day, the committee is to hold an evidence session with the Financial Conduct Authority as it continues its inquiry into the cryptocurrency space.

BREAKING: Financial Times reports UK government has finalized plans for regulation of the crypto sector

— The Spectator Index (@spectatorindex) December 5, 2022

Additionally, the meeting will also include a hearing of how football fans lost crypto tokens endorsed by high-profile players and football clubs.

Prime Minister of the United Kingdom, Rishi Sunak earlier stated while he was the chancellor that effective regulation will help the United Kingdom become a global hub for crypto technology. The above-mentioned individual also encouraged “the businesses of tomorrow to invest, innovate and scale up on UK shores”.

According to individuals familiar with the Treasury’s way of thinking, the regulators will have more power to police the sector, including a clampdown on crypto-related advertisements by companies based outside the UK, the Financial Times reported on Monday.  The Financial Conduct Authority(FCA) will also monitor how crypto companies operate and advertise their products.

The FCA is said to have been conducting money laundering inspections of crypto firms based in the UK. It turned out that 85% of the crypto firms that had earlier applied to be part of the regulator’s crypto register were not qualified, as they failed in anti-money laundering tests.

Regulators are expected to see a restriction on trading into the UK market from overseas and further rules on how crypto companies can be wound down. The financial services and the market bill are to be updated and will include the new regulatory powers passed.

The bill was amended in late October to include future provisions for regulating the cryptocurrency industry. The piece of legislation is already before parliament, dealing with the UK’s post-Brexit approach to financial regulation.

The Financial Services and Markets Bill is designed to shape the UK’s financial sector post-Brexit and includes sections defining stablecoins and crypto assets.

We need to put in place clear guard rails for these kinds of centralized actors and this is what founding members of CryptoUK came to this select committee in 2018 and asked for.

Taylor said.

Asked last month how an FTX-style collapse could be avoided, Ian Taylor, executive director of industry association CryptoUK, told British lawmakers the country’s failure to design a proper regulatory framework for crypto trading venues and service providers hadn’t helped.