The approach taken by the government and parliament of the United Kingdom to introduce extensive laws to oversee the crypto business does not contradict the general notion that the technology behind the digital currency ecosystem is innovative and futuristic.
Under the leadership of Prime Minister Rishi Sunak, the United Kingdom (UK) is considering expanding the Financial Conduct Authority’s (FCA) regulatory authority over the digital currency ecosystem. The failure and subsequent bankruptcy of FTX Derivatives Exchange, according to a story in the Financial Times, have prompted all authorities to seek more control over the business.
The new laws administered by the UK Treasury will restrict the operations of international crypto businesses that sell their products inside the nation.
During Rishi Sunak’s tenure as Chancellor of the Exchequer, the United Kingdom formulated specific plans to introduce regulations that would make the crypto business a key centre for digital currencies. The proposed new regulations would restrict the actions of stakeholders in this area, acting as a countermeasure to its original ambitions.
As part of its supervisory responsibilities, the FCA will now control how crypto businesses market their products in the United Kingdom to ensure they are not deceptive. In the event that a company must depart the United Kingdom or declares bankruptcy, the proposal will also include plans or strategies for its dissolution.
All businesses will be required to register with the FCA and pass its Anti-Money Laundering (AML) examinations. According to Nikhil Rathi, the FCA’s chief executive officer, the agency has documented more businesses failing its AML checks, to the tune of 85 percent. With the current tight standards for issuing licenses to businesses, further severe regulations may discourage others from applying.
Despite not having ultimate authority at present, the FCA chief said that the agency is extremely aggressive in informing the public about “the hazards of investing in cryptocurrencies, including the possibility of losing all of your money.”
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