The House of Lords has approved legislation classifying crypto as a “regulated activity”
The upper chamber approved the Financial Services and Markets Bill of Parliament, which contains provisions governing crypto assets.
A bill introduced on July 20, 2022, may profoundly affect the cryptocurrency markets. The measure has advanced towards becoming law after receiving support from the House of Lords.
The FSMB was first introduced last year with the intention of capitalising on post-Brexit prospects and providing more authority to financial regulators. This included a provision for regulating stablecoins in accordance with national payment laws. However, as the law passed through Parliament, changes were inserted to classify the use of all cryptocurrencies as a regulated activity and establish guidelines for monitoring crypto marketing.
As a follow-up to the Government’s “Future Regulatory Framework” assessment, this bill is expected to implement sweeping reforms across the financial services industry, including eliminating all legislation and regulatory obligations based on EU measures due to Brexit.
Establishing the law to regulate crypto-assets and their suppliers is particularly relevant to the cryptocurrency business. This groundbreaking change in UK legislation marks an honest effort to establish regulatory oversight in a sector with a reputation for anarchy. The change is anticipated to provide the famously opaque cryptocurrency markets with much-needed stability.
The measure also intends to regulate ‘Buy Now Pay Later’ products and their suppliers in order to strengthen consumer protection. Concurrently, it ensures that people may continue to get their hands on cash, which is crucial in communities where that payment is still widely used.
Moreover, it raises the possibility that those who fall prey to Authorised Push Payment (APP) fraud would be required to get compensation. The law seeks to increase responsibility in the financial ecosystem by imposing stricter rules on people who authorise financial promotions for others in response to the widespread problem of fraudulent application program interfaces in the United Kingdom.
Several discussions on the bill’s terms are ongoing while it goes through the legislative process. While specific rules will likely be quickly incorporated into the regulatory framework, others are anticipated to spark heated discussion.