The UK government is gearing up to introduce new legislation aimed at regulating stablecoins and staking activities within the cryptocurrency space by mid-2024.

Government Push for Swift Regulation

Bim Afolami, the Economic Secretary to the Treasury, emphasized the government’s determination to expedite the process of passing regulations concerning stablecoins and staking. Speaking at an industry event, Afolami stressed the urgency of enacting legislation within the next six months.

Phased Regulatory Approach Unveiled

The UK has adopted a phased approach to regulate the cryptocurrency sector. In October, the Treasury unveiled initial proposals focused on overseeing fiat-backed stablecoins, particularly in the realm of payments. This initial phase lays the foundation for subsequent regulations that will address the broader crypto asset landscape.

Also Read: UK Introduces Digital Securities Sandbox Regulatory Framework

Stablecoin Oversight Led by Regulatory Trio

Under the proposed regulations, a coalition of regulatory bodies, including the Bank of England, Financial Conduct Authority, and Payment Systems Regulator, will collectively oversee certain fiat-backed stablecoins. These regulatory measures come following a consultation in February aimed at refining the UK’s approach to regulating crypto assets within the financial services sector.

Response and Feedback from Industry Players

The proposed regulations have elicited a mixed response from industry stakeholders. While some view the regulatory framework as a positive step towards establishing the UK as a crypto-friendly hub, others remain cautiously optimistic. Treasury Minister Andrew Griffith has welcomed the stablecoin framework, acknowledging it as a move in the right direction following months of public anticipation.

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