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- In May 2023, a cross-party Committee of MPs put forward a recommendation for new legislation.
- Andrew Griffith stated that such regulation would contravene international standards.
The HM Treasury of the United Kingdom has expressed strong disagreement with the House of Commons Treasury Committee’s proposal to classify cryptocurrency trading as gambling. In May 2023, a cross-party Committee of MPs put forward a recommendation for new legislation.
In its official report, the Committee highlighted that crypto assets possess “no intrinsic value” and cautioned against regulating them as financial assets, which could create a “halo effect” and mislead consumers into believing that this activity is safer or more secure than it actually is.
Stringent Regulations Underway
Additionally, on July 19, responding to the Committee’s concerns, Economic Secretary to the Treasury Andrew Griffith remarked that such regulation would breach international standards. He also noted that it could lead to the relocation of crypto asset activities offshore and would not effectively tackle issues such as market manipulation or inadequate disclosures.
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Furthermore, the report emphasized the need to address the risks associated with unbacked crypto assets. It stated that conditions for safe innovation should be established, ideally through a financial services regulatory framework. Recent advancements in crypto legislation were also mentioned in the official statement.
The government indicated:
“HM Treasury and the FCA [Financial Conduct Authority] will collaborate with the industry to ensure that crypto firms are fully informed of the standards necessary for approval at the FSMA gateway. Further communications will be issued in due course to ensure that the approval standards are clearly accessible to crypto firms operating in the UK.”
The Financial Services and Markets Bill (FSMB), which aims to regulate cryptocurrencies and stablecoins, has made strides toward becoming law. According to government officials, the FSMB is expected to be enacted by late 2023.
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