UK Considering Cryptocurrency Regulations in Response to US Influence Led by Trump, According to Invezz
Invezz.com –
The British government is gearing up to unveil its plans for regulating the cryptocurrency sector as the industry eagerly awaits potential regulations under a Donald Trump-led US administration. This comes as the UK government prepares two legislative proposals, one for stablecoins and another for staking services, according to sources familiar with the plans cited by Bloomberg.
The stablecoin legislation will empower the Financial Conduct Authority to collaborate with the industry on setting regulatory guidelines, while staking services are expected to be reclassified to avoid stringent financial regulations.
Plans for stablecoins and staking services legislation
Stablecoins are digital tokens linked to more stable assets like the US dollar, offering less volatility. The FCA is set to release a roadmap for regulating stablecoins, along with broader industry regulation.
Meanwhile, staking services, where investors lock tokens to support blockchain operations in exchange for returns, will be reclassified to avoid being categorized as collective investment schemes. The government is also set to provide an update on the digital securities sandbox, a testing environment for blockchain innovation managed by the FCA and the Bank of England.
Trump’s US: a growing threat to the UK’s crypto ambitions
The UK government’s plans for crypto legislation were initially delayed due to leadership changes, pushing the process to 2024. Meanwhile, Trump’s pro-crypto stance has made the US an attractive destination for crypto startups, potentially impacting the UK’s crypto ambitions.
The UK faces pressure to catch up with global competitors like the EU, where regulations are advancing rapidly. Industry leaders are urging swift government action to provide regulatory clarity and maintain the UK’s position as a leader in digital assets.
Crypto sector urges swift action from the UK
The lack of regulatory clarity in the UK has caused hesitation among crypto firms to invest in the region. As other European countries progress with their regulatory frameworks, the UK must act swiftly to capitalize on its position in the digital assets space. Industry groups are eagerly awaiting more specific guidelines from the Treasury by early 2024 to ensure the UK remains at the forefront of the digital assets sector.
This article first appeared on Invezz.com
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