UK to classify cryptocurrencies as financial instruments

On 25 October the House of Commons (the UK’s lower chamber) backed amendments to the Financial Services and Markets Bill. In particular, the proposed changes would bring digital assets within the scope of regulated financial services.

Member of Parliament Andrew Griffith noted that the measure would allow the Treasury to respond quickly to developments in the industry and to ensure a ‘flexible’ approach to supervision.

“The point is to treat them [cryptocurrencies] as just another form of financial assets and not give them preferential treatment, and to bring them within the regulatory perimeter for the first time,” Griffith said, CoinDesk reported.

One clause clarifies that crypto assets may come under the existing provisions of the Financial Services and Markets Act 2000. The amendments also regulate the activities of UK-registered companies.

“The Treasury will consult with industry and stakeholders before using its powers to ensure the framework reflects the unique advantages and risks associated with cryptocurrency,” said the member of Parliament.

The term DSA includes stablecoins, “given their potential to become a widely used means of payment”.

The Financial Services and Markets Bill introduced in Parliament in the United Kingdom in July.

Earlier, Deputy Governor of the Bank of England Jon Cunliffe proposed regulating cryptocurrencies in line with traditional finance.

Earlier, former Chancellor of the Exchequer and advocate of digital assets Rishi Sunak became the United Kingdom’s new prime minister.

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