The United Kingdom’s treasury department proposed to exclude unbacked crypto assets and derivatives from the Digital Securities Protected Area plans. The new proposal may encompass the flagship markets, Bitcoin (BTC) and Ethereum (ETH). Here are the details!
Cryptocurrency Legislation!
In a report published on July 11, the HM Treasury stated that the regulatory digital spaces to be established under the country’s Financial Services and Markets Act would provide the UK government with the necessary time to amend existing legislation for cryptocurrency products if necessary. The proposed framework was aiming to allow companies to operate in a way that parliament thought their products or services could fall under existing regulations.
However, according to the new report, these issues may not cover “unbacked cryptocurrencies” that are “still developing” along with derivatives. The Treasury stated in the report that it will take into consideration feedback on the proposed digital securities protected area until it expires in August 2023.
Could Cover BTC and ETH!
It also suggested that assets including the leading cryptocurrency, Bitcoin (BTC) and Ethereum (ETH) may not qualify under the Treasury initiative. United Kingdom lawmakers have previously labeled cryptocurrencies as “unbacked” and advocated for them to be treated as illegal. The Treasury, referring to unsupported tokens, stated the following in their remarks:
Until there is more clarity in these frameworks, we plan to use existing regulatory initiatives to develop policy and regulation for this asset class.
Under the Financial Services and Markets Act, cryptocurrency companies operating in the United Kingdom will have to comply with certain guidelines aimed at protecting consumers while promoting innovative technologies. The country’s Financial Conduct Authority warned companies that from October 2023, it would only allow “four routes” to legally communicate “cryptocurrency asset promotions”. It is stated that clarity will be achieved in the coming days.
