U.K. lawmakers have supported a move to recognize Bitcoin (BTC) and other cryptocurrencies as regulated financial instruments and digital commodities in the country.
The decision followed a sitting on Tuesday, October 25, for a comprehensive reading of the proposed Financial Services and Markets Bill to add crypto to the scope of activities for regulation. The meeting ended with The House of Commons, Parliament’s lower house, voting to recognize Bitcoin and crypto as regulated financial instruments.
Griffith Proposed the Idea During the Discussion of the Bill
The bill covers the U.K.’s post-Brexit economic strategy expansively, including a proposal by parliamentarian Andrew Griffith to integrate crypto assets within the scope of regulated financial services in the country.
During the parliamentary meeting before the majority of the lawmakers voted to keep the amendment in the legislative package, Griffith, the Financial Services and City Minister, said:
“The substance here is to treat them [crypto] like other forms of financial assets and not to prefer them, but also to bring them within the scope of regulation for the first time.”
Following the appointment of Rishi Sunak as theU.K.’s new Prime Minister, the country’s crypto market is poised to embrace efforts to recognize digital assets legally. Noteworthy, the markets bill and the stablecoin regulations were introduced during Boris Johnson’s administration when Sunak served as finance minister.
According to the report, the bill contains crypto-related provisions hinged upon the definition of “crypto as definite,” as envisaged under clause 14. Clause 14 articulates that crypto assets could be brought within the scope of the existing provisions of the Financial Services and Markets Act 2000, which relates to regulated financial activities.
Griffith believes these measures could control cryptocurrency advertising and unauthorized companies operating in the country illegally.
“The Treasury will consult on its approach with industry and stakeholders ahead of using the powers to ensure the framework reflect the unique benefits and risks posed by crypto activities.”
Griffith believes that including crypto within the bill’s brackets will ensure that U.K.’s Treasury is empowered to respond quickly to developments within the crypto space. The parliamentarian also supports that this will be an enabler in delivering regulation in a “dexterous” way consistent with the U.K.’s more expansive approach to financial services regulation.
The U.K. to Become a Crypto Hub
U.K.’s economy has been sinking as citizens continue to deal with a series of issues, from inflation to the energy crisis. Amid these concerns, the country’s Prime Minister Liz Truss announced her resignation barely a week ago.
Now that Rishi Sunak has taken over office as U.K. Prime Minister, things are expected to change. Being pro-crypto, Sunak looks to make the U.K. a crypto innovation hub. It is within this promise that the country’s lawmakers voted to recognize cryptocurrencies as regulated financial instruments and products.
From its inception, the Financial Services and Markets Bill has sought to extend payment rules to stablecoins and already includes plans to this effect in the form of cryptocurrencies pegged to the value of other assets such as the U.S. dollar (USD) or gold.
Griffith’s proposal notwithstanding, it may take some time before the regulations become law. As it stands, the next step involves presenting the bill to the House of Lords, the upper house of the U.K. Parliament, after which the amendments will get a final consideration before royal approval by late Queen Elizabeth’s successor, King Charles III.
The treasury will now seek input from various stakeholders and industry pundits to execute the framework. The consultation will also entail a thorough risk and benefits assessment. Nonetheless, this development is timely given that visionary countries are already looking to position themselves as crypto hubs.