The United Kingdom’s (UK) Finance Minister, Nadhim Zahawi will finally introduce the long-awaited financial services and markets bill before the parliament today. The bill that is aimed to “capitalize on the benefits of Brexit and transform the UK financial services sector”, will also pitch a regulatory framework for stablecoin payments.
“Consumers will remain protected, with legislation ensuring that victims of scams can be compensated while also acting to protect access to cash for the millions of people that rely on it,” Zahawi told guests at the City of London’s annual Mansion House dinner in the historic financial district.
The financial services and markets bill which was announced last year was largely pro-crypto in its early phase. However, recent industry events and extreme market conditions triggered regulatory action.
Earlier this month, the U.K. Treasury together with the country’s Central Bank — Bank of England (BoE), the Payment Systems Regulator (PSR), and the Financial Conduct Authority (FCA) confirmed the timeline for introducing legislation on a legal framework for stablecoins. Following this, the deputy BoE Governor, Jon Cunliffe addressed the delay by indirectly referring to the pro-crypto officials’ exit — Treasury chief Rishi Sunak and senior Treasury official Jon Glen after they had predicted that the UK will become the next crypto hub.
UK Regulators’ “Told You So” Stance
While all sectors of the crypto market saw a domino effect-like collapse in the past 2 months, the UK’s financial disputes agency — Financial Ombudsman Service (FOS) conveyed their anti-crypto stance earlier this year, confirming a substantial hike in crypto-related online scams and fraud. The acting Financial Services and Pensions Ombudsman, MaryRose McGovern highlighted that the regulatory authority had witnessed an increase in the number of complaints from people who lost funds by investing in crypto assets scams.
Subsequent to pointing out the rise in illicit crypto operations, McGovern also emphasized that the agency had already warned investors against such risks in 2021. Last October, the UK Finance intelligence alerted investors against emerging cryptocurrency-related frauds, along with a spike in money laundering activities using cryptocurrency wallets to facilitate easy withdrawals from banks.