UK Adopts Crypto and Stablecoins as Regulated Financial Activity

<p>A bill that aims to regulate cryptocurrencies and
stablecoins in the UK has been approved by King Charles. Dubbed the Financial
Services and Markets Act 2023, the new law classifies the trading of
cryptocurrencies as a regulated activity and brings stablecoins under the scope
of payment rules.</p><p>The Financial Services
and Markets Act 2023 gives regulators more power to govern financial systems,
including the digital assets. The bill, which got the approval of the upper house
last week, permits the regulators, including the <a href="https://www.financemagnates.com/terms/f/financial-conduct-authority-fca/" target="_blank" rel="follow">Financial
Conduct Authority (FCA)</a>, the
Bank of England, and the Payments Systems Regulator, to introduce new rules in
the digital asset sector.</p><p>Unlocking Innovation</p><p>Andrew Griffith, the
Economic Secretary to the Treasury, said that the new law presents an
opportunity to tailor the regulations of financial services to the UK market since the country
left the EU. Additionally, it is expected to enhance the scrutiny and the accountability of the regulators.</p><p>"This landmark
piece of legislation gives us control of our financial services rulebook. It
supports the UK businesses and the consumers, and drives growth," Griffith said.
"By repealing old EU laws set in Brussels, it will unlock billions in
investment cash that can unlock innovation and grow the economy."</p><p>Through the new
legislation, the UK expects to promote the safe adoption of cryptocurrencies in
the country. Additionally, it will create a framework to facilitate
the testing of new technologies like the <a href="https://www.financemagnates.com/cryptocurrency/innovation/blockchain-technology-revolutionizing-industries-beyond-finance/" target="_blank" rel="follow">blockchain
technology</a> in the
financial markets, the HM Treasury said in the statement. </p><p>The UK Curbs Crypto
Promotions</p><p>The original version of the comprehensive bill was
introduced in July last year and proposed to regulate stablecoins under the
payments services rules. However, as the bill progressed through parliament, the
amendment to treat crypto trading as a regulated activity was introduced.
Additionally, the measures to control the promotion of digital assets
were later included.</p><p>Griffith said in an
interview with CNBC in April that the specific rules for cryptocurrencies could
be introduced within a year. According to Griffith, the step is part of an
agenda to establish the UK as a global hub for the cryptocurrency technology.</p><p>Meanwhile,
<a href="https://www.financemagnates.com/" target="_blank" rel="follow">Finance Magnates</a> reported that the EU passed the Markets in Crypto-Assets (MICA)
regulation in May, making Europe the first jurisdiction <a href="https://www.financemagnates.com/cryptocurrency/mica-takes-off-eu-council-approves-crypto-law/" target="_blank" rel="follow">to
introduce</a> comprehensive
laws on digital assets. MiCA aims to protect European investors, promote
environmental sustainability, and prevent money laundering in the
cryptocurrency sector.</p>

This article was written by Jared Kirui at www.financemagnates.com.