UK Believes in Crypto Industry Despite Massive Bankruptcies
UK Believes in Crypto Industry Despite Massive Bankruptcies
2023.01.11 15:39
UK Believes in Crypto Industry Despite Massive Bankruptcies
By Ray Johnson
Budrigannews.com – Despite the recent negative developments on the market, the United Kingdom remains committed to becoming a global hub for the crypto industry. On January 10, Member of Parliament and HM Treasury Economic Secretary Andrew Griffith stated that it is “the sector I have dedicated the most time to,” underscoring his commitment.
The process will move on to the Financial Markets Infrastructure (FMI) sandbox and the wholesale stablecoin introduction. The Financial Services and Markets (FSM) bill, which will also receive its second reading in the House of Lords on January 10, includes those components.
Griffith stated that in the “long runtime” preceding the potential introduction of a central bank digital currency (CBDC), a stablecoin will likely serve as a “first use case of what is likely to be a wholesale settlement coin.”
Griffith defended the wholesale stablecoin project, stating that stablecoins are “here now” and require immediate attention. He mentioned that it’s not clear whether introducing a CBDC would force private stablecoins off the market.
Griffith stated that if a retail British CBDC were to be established, it would be designed as an anonymous and intermediated platform.
“In weeks, not months,” a consultative paper on CBDC will be published, followed by another on crypto regulation in general. This year, the government will also host at least six roundtable discussions with the crypto industry.
Griffith stated that “not the government’s position that this [crypto-based technology] is an inevitability.” However, he added that current technology cannot “disruptively” solve problems in the financial sector like settlement time as blockchain technology can.
The @CommonsTreasury Inquiry in to #Cryptoassets continues today with another oral evidence session. This time including Andrew Griffith MP, Economic Secretary.#crypto #cryptoregulation #cryptoinquiry
Griffith distinguished crypto as a means of payment from an investment for retail customers. Griffith asserted that unbacked cryptocurrency might “find a role or not in the market.”
Despite the fact that “there is a very strong commitment to the continued use of and access to cash,” in which banks continue to have a place, crypto-based payment methods pose a problem for digital and financial inclusion. Griffith asserted:
“Removing that intermediary, certainly at the current evolution of the market, feels very premature.”
The FSM bill, which could “be done by Easter,” will also let some new payment apps be licensed in the FMI sandbox and put on the market. Griffith stated that for the time being, the use cases for crypto-based wholesale fintech might be found in registers and ledgers “in the middle office.”
Griffith assured a committee member that crypto asset markets will not be completely regulated by 2023. The principle of “same asset, same regulation” will be followed in legislation.
In the interim, consumer protection is relying heavily on oversight of crypto promotions. To verify that they are dealing with a regulated organization, customers can look for the Financial Conduct Authority (FCA) logo on promotional materials. The committee was informed by Laura Mountford, deputy director of payments and fintech for the Treasury.
However, according to Mountford, who cited FCA monitoring, only about 40% of consumers “understand or consider that they are buying crypto assets as a gamble.”
