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UK Regulators Looking to Implement Stricter Rules?

cryptocurrency

Regulatory clarity seems to give the crypto market a hard time. It was the primary reason why the crypto market went bearish in the first place. However, it could also be the next step before the crypto market could recover. Initially, many believed that by the time regulatory changes are all settled that institutional investors are just going to swarm on the crypto market. Unfortunately, that process isn’t happening the way other people predicted it.

Though we have the US Securities and Exchange Commission declared both Bitcoin and Ethereum as commodities and went after ICOs that are selling unregistered securities, there is still a lot of work that waiting for regulators.

As for institutional investors joining the crypto market, you now have Bakkt and you also have the possibility of having a Bitcoin ETF. Though both could easily rejuvenate the market, could it actually bring Bitcoin back into the where it was? Bitcoin was able to reach near $20,000 from around $1,000 in just a matter of a year.

Strict Approach by UK Regulators?

For UK’s Financial Conduct Authority (FCA), now that Bitcoin was knocked down to below $4,500, they now have enough time to implement the necessary changes in the market. The regulators are looking to expedite the process and even having a heavy-handed approach to the market. The regulators hinted that they are looking to impose a balance between protecting the investors and fostering innovation within the niche.

In a conference that was dedicated towards crypto regulations in London, Gillian Dorner who works as the deputy director for financial services at Britain’s finance ministry mentioned that “We want to take the time to look at that in a bit more depth and make sure we take a proportionate approach”.

The regulators are already looking closely at 2,000 crypto assets. From these crypto assets, the regulators are trying to figure out what to do next.

Christopher Woolard who is the FCA’s executive director for strategy and competition mentioned that the FCA is working in order to improve the details of their existing regulations as well as the prospective regulation. Woolard mentioned that there are many “grey edges” in the current regulation.

By the end of the year, Woolard mentioned that the agency is going to “clarify which cryptoassets fall within (its) existing regulatory perimeter, and those crypto assets that fall outside”. UK’s finance minister is looking forward to work with the financial watchdog in order to apply the necessary changes in the industry.

Consultation in 2019

However, it seems that there will still be no regulatory clarity at least in the UK until next year. The FCA is looking to launch a consultation during the first quarter of the year. They are going to decide whether or not to ban the sale of crypto-based derivatives in the future.

Regulations on cryptocurrencies worldwide still need a lot of work. There are a number of issues that need to be addressed including issues on security and even defining which token falls under security or commodity. At least for now, UK’s regulators have the time to assess what their next step is now that the crypto market has mellowed down after the Bitcoin Cash hard fork.

Lee Jenkins

Lee is our resident cryptocurrency expert who knows the ins and outs of each coin and the blockchain technology behind them. You’ll find that most of our technical guides are written or overseen by Lee and they are all easily digestible by the new and experienced alike, so there is no better place to learn blockchain 101 than here. Occasionally you may see a news article from him if it’s tech related!

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