Governments from across the globe are closely looking into Bitcoin and other cryptocurrencies. While some nations have imposed strict rules on these assets, others appear to be more welcoming. The third group of nations is untethered by the burgeoning crypto industry. The UK government has continuously attempted to stay out of the crypto-wave. However, the ever-increasing demand for these assets has compelled the government to enact industry-specific rules.
According to CNBC, Finance Minister Rishi Sunak will make an announcement on these measures in the coming weeks. According to the insider, the government has taken time to learn about Bitcoin and other cryptocurrencies including stablecoins. The government was able to learn the risks as well as the benefits surrounding the market from major industry players like the Winklevoss brothers.
The term ‘regulations’ can mean a lot of things for the crypto-verse. Despite starting off to move away from centralized systems, the industry has been undergoing intense government scrutiny. As a consequence, regulations may be both frightening and beneficial to the cryptocurrency industry. The upcoming regulations, however, are “likely to be favorable to the industry.”
One Twitter user pointed out that their interest in stablecoins could impact Tether [USDT] in a destructive way.
“DOESN’T LOOK GOOD FOR #Tether and Co.: Like the EU’s framework for crypto assets that is currently making its way through the legislative process, the U.K.’s regulatory efforts may also focus heavily on stablecoins.”
Bank of England ahead of Government in terms of Crypto?
While the government has just started to look into the crypto market, the Bank of England [BoE] has already taken a major leap. As per a recent announcement, BoE has reportedly partnered with the Massachusetts Institute of Technology’s Digital Currency Initiative [DCI]. This partnership is all set to aid the bank to unveil the benefits and challenges of rolling out the digital pound.
The 12-month research project would entail an array of things starting from possible challenges technically, risks pertaining to the design process of CBDC, trade-offs as well as potential opportunities. The announcement further read,
“This work is focused on exploratory technology research and is not intended to develop an operational CBDC. No decision has been made on whether to introduce a CBDC in the UK, which would be a major national infrastructure project.”