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Amendment of UK financial services bill focuses on crypto regulations

Amendment of UK financial services bill focuses on crypto regulations
Amendment of UK financial services bill focuses on crypto regulations

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The United Kingdom is set to consider an amendment to the Financial Services and Markets Bill. This amendment will extend the powers of the law so that it also focuses on regulating financial promotion alongside other activities related to crypto products.

UK financial services bill targets crypto regulations

The amendment of this bill was written by Andrew Griffith, a Member of Parliament and Financial Secretary to the Treasury. The bill comprises 335 pages, and it was introduced in July.

The bill will have its second reading in the House of Commons on September 7. An explanatory statement from the company has also added that the bill will focus on providing regulatory clarity on the matter.

The statement adds that the bill will,

Clarify that the powers relating to financial promotion and regulated activities can be relied on to regulate cryptoassets and activities relating to cryptoassets.

Crypto regulations in the UK

The Financial Conduct Authority (FCA) is currently the primary regulatory body for the cryptocurrency market in the United Kingdom. On August 9, the FCA published a letter titled “Dear Chief Executive” addressing the supervisory strategy related to financial companies known as “alternative portfolio.”

The letter added that the FCA would publish the final rules on promoting cryptocurrency assets after the US Treasury formalizes the legislation process, bringing the crypto market into its purview.

Most cryptocurrency activities in the United Kingdom are currently not under the regulatory scope of the FCA. However, firms offering crypto services can choose to apply for registration, and this will become a mandatory procedure in 2023.

The crypto regulatory scope in the UK currently focuses on Anti-Money Laundering and Counter-Terrorism measures. However, the regulations have become a challenge to many applicants in the country.

Nevertheless, the lack of regulatory clarity has not deterred the UK from becoming one of the largest cryptocurrency markets globally. A crypto adoption index analysis by Chainalysis showed that the UK ranked as the 17th market in cryptocurrency adoption.

In August, the FCA took action to advertise high-risk financial products. The regulatory body also said that cryptocurrency assets carried a high risk, but the agency had not yet started regulating the assets.

The UK’s Advertising Standards Authority has aggressively monitored advertising activities within the crypto market. In September, the former financial secretary, Richard Fuller, stated that the government planned to transform the UK into a primary hub of cryptocurrency technologies.

On October 10, the European Parliament Committee on Economic and Monetary Affairs approved the Markets in Crypto-Assets bill. A full parliamentary vote on the bill is expected to happen soon.

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