[ad_1]
LONDON, Jan 31 (Reuters) – Following the collapse of crypto exchange FTX last year, the UK Treasury is planning “strong” regulation of cryptocurrencies.
Currently, cryptocurrencies are globally unregulated and businesses are only required to conduct checks to prevent money laundering. But the UK’s Financial Conduct Authority (FCA) says more than 80% of license applicants have failed to prove they can do this properly because “dark money” flows through the field. .
Financial Services Minister Andrew Griffiths said in a statement on Tuesday that the draft rules, due to be published on Wednesday, ensure robust, transparent and fair standards consistent with traditional approaches to finance. Stated.
“We remain unwavering in our commitment to growing our economy and enabling technological change and innovation, including crypto technology,” said Griffiths.
The new rules came after rising interest rates sparked a series of bankruptcies in the sector in 2022, wiping $1.4 trillion from the value of the crypto market. The price of the most widely traded bitcoin plunged 60%.
latest update
Show 2 more stories
While the market crash has shaken confidence in cryptocurrencies, there remains interest in the underlying technology, most commonly known as blockchain, for other uses such as payments.
A three-month public consultation on the new plan will follow, followed by detailed rules proposed by the FCA.
The ministry said its approach would mitigate the sector’s most critical risks.
“These proposals make crypto exchanges responsible for defining detailed content requirements for authorization and disclosure documents, ensuring that crypto exchanges have fair and robust standards,” the ministry said. I’m here.
There are rules regarding financial intermediaries that facilitate transactions and custodians that hold customer assets.
The failure of FTX and other exchanges has sparked calls for industry regulation to protect investors. Regulators focus on open “cryptocurrency conglomerates” that combine trading, lending, custody and other activities under one roof, but without traditional regulatory safeguards in between.
The European Union has already finalized its first set of crypto rules.
Companies already approved by the FCA will be allowed to temporarily issue their own promotions while the new regulatory regime is put in place, the ministry said.
Reported by Hugh Jones.Editing by Sharon Singleton
Our standards: Thomson Reuters Trust Principles.
[ad_2]
Source link
