The Bank of England talked about urgent regulation of cryptocurrencies
2022.11.21 04:53
The Bank of England talked about urgent regulation of cryptocurrencies
Budrigannews.com – The collapse of the FTX cryptocurrency exchange indicates the need to introduce cryptocurrencies as part of regulation, Deputy governor of the Bank of England John Cunliffe said on Monday.
FTX, which is filing for protection in bankruptcy court in the United States, said that it owed almost $3.1 billion to the 50 largest creditors.
“And although the crypto world, as was shown in the last crypto winter and the collapse of the FTX last week, is not large enough today and is not connected to the main finances to threaten the stability of financial systems, its relationship with the main finances is going faster,” Cunliffe said.”
She added that the FTX issues showed the need to impose as tight a control as possible on regulators.
“It is not worth waiting for it to become larger and connected in order to create a regulatory framework that should be necessary in order to prevent crypto shocks that can have a much more destructive impact,” Cunliffe said, speaking at an event at the Warwick Business School.
At the moment, UK crypto firms only have to show their capabilities so that they can provide sufficient control to stop money laundering, despite the fact that many companies have received applications for licenses from British regulators.
The UK has approved a new law on financial services and markets, which will introduce regulation of stable coins and crypto assets to ensure assets such as currency and marketing of crypto assets.
Cunliffe said that the Bank of England will hold a public consultation on a more detailed clarification of the rules of stable coins, on structuring the requirements of coin owners to the issuer and wallets to ensure repayment at par on the money of commercial banks.
“The FTX example highlights the importance of these aspects,” Cunniff said.
In the near future, the Ministry of Finance will advise investors on the protection of investors’ interests and integrity in the market, as well as on other regulatory frameworks that relate to the promotion and trading of a financial product, activities and organizations related to crypto assets.
The Bank of England is separately considering the potential of digital pounds.
“Our task is to ensure that innovations can be implemented, but in an environment where risk management should be organized,” Cunniff said. “The events of the past week are a convincing demonstration of why this is important.”
