UK Plans to Regulate Crypto Under “Tough” New Financial Services Law

Joshua Ramos
UK May Already Be in a Recession, Says Bank of England
Source: The Economic Times

According to the country’s regulatory entity, the Financial Conduct Authority (FCA), the UK plans to regulate crypto under a “tough” new financial services law. Moreover, Reuters reported statements from the regulator claiming tougher standards are needed to “detoxify” crypto to protect consumers.

The FCA’s new chair, Ashley Alder, spoke on new crypto legislation needing to mimic the toughness of the traditional finance industry. Specifically, the country will implement those new regulatory standards in new financial services laws to be implemented this year.

The UK Announces New Financial Services Laws

2022 saw the collapse of FTX and the host of bankruptcies that riddled the industry. Subsequently, as the new year started, countries seemingly placed an emphasis on regulation. Therefore protecting the consumers from risks they had been unaware of.

Now, the UK has set forth its plans to regulate crypto under a “tough” new financial services law implanted this year. Specifically, the country’s regulatory body, the FCA, has noted its desire for digital asset regulation to mirror the strictness of traditional finance.

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“One of the questions in my mind is when you put in place a regulatory framework around crypto, the interesting aspect is the degree to which crypto will need to adapt and effectively detoxify to fit into that regime,” Alder stated. Additionally noting that regulation standards similar to traditional finance would force “crypto business models to change radically,” according to Alder.

Around 85% of crypto firms that applied for operation permission in the UK were denied due to the FCA compliance standards. Specifically, the regulator noted that some firms requesting permission were evasive, boasting conflicts of interest as well as a lack of safeguards. Logically, these new financial services laws will integrate a unified regulatory standard that could be helpful for those companies willing to comply.