The Treasury Committee of the House of Commons has proposed regulating cryptocurrencies like gambling, an idea that has been roundly rejected by HM Treasury, the United Kingdom’s economic and financial ministry.
In May, the UK Treasury Committee advocated for the same kind of gambling-style regulation of unbacked cryptocurrencies. In that report, legislators acknowledged that betting on the future value of these assets “more closely matches gambling than it does a financial service.”
On Thursday, Britain’s Financial Services Minister Andrew Griffith responded by saying that the Exchequer “firmly disagrees” with the MPs’ suggestion that crypto assets be treated as a kind of gambling.
Griffith went on to say that numerous serious hazards, such as the reported mixing of client funds at the defunct cryptocurrency exchange FTX, might go unchecked by a system of gaming regulation. The UK government has said that it is unlikely to address issues such as market manipulation, insufficient prudential measures, and flaws in basic financial risk management practices.
To mitigate the dangers of unbacked crypto assets and foster secure innovation, a financial services regulatory framework is preferable.
The government has also said that they are trying to regulate the crypto market and that a draft regulation bill has been submitted to parliament.
It fits nicely with Prime Minister Rishi Sunak’s plans to make the United Kingdom a global centre for the cryptocurrency industry.
The Exchequer also approves of the panel’s recommendation for a moderated strategy to encourage new forms of innovation, such as crypto asset technology.
However, the government also intends to set up Financial Market Infrastructure (FMI) sandboxes, where businesses may test out blockchain technology in order to make the market more “efficient, resilient, and transparent.”
Also Read: SEC Chair Gensler Requests Additional $109 Million In Funding To Tame The “Wild West” Of Crypto
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