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Source: TAXDAO
British Economic Minister BIM AFOLAMI plans to introduce new laws to supervise stable coins and cryptocurrencies, seeking to cope with this rapid development industry through license requirements, taxation impact, trading platform review, and strong security measures.
On April 15, 2024, at the Innovative Finance Global Summit, the British Economic Minister BIM AFOLAMI announced that it plans to introduce new laws to regulate the country’s stable coins and cryptocurrencies.This comprehensive regulatory framework is expected to be announced in July 2024 and will make Britain a regulatory leader of the booming cryptocurrency industry.
The British cryptocurrency industry is one of the fastest -growing crypto markets in the world. After experiencing strong growth in the past ten years, its development speed exceeds Germany and the United States.The popularity of cryptocurrencies in the country and its feasibility as a legitimate asset gives the country more than 3 million cryptocurrencies.It is estimated that the cryptocurrency wealth of these users exceeds 3.72 billion US dollars.In addition, the total revenue of the British cryptocurrency industry in 2023 is estimated to be US $ 1.9 billion, and it is expected to reach $ 2.53 billion in 2024.
As the mainstream British companies use more and more cryptocurrencies, this index -level growth and market penetration have helped push the demand for the supervision of the industry.
1. What are the expectations of the new secret law
Today, cryptocurrencies have affected many industries from the latest currencies that promote online banking to support online gaming.It is not difficult to understand that Britain hopes to create a clear and secure encryption environment in the country by formulating a clear rules of encrypted world operation.
At the Innovation Finance Global Summit, BIM AFOLAMI said that the final proposal of the system is being actively formulated to ensure that the regulations can be introduced as soon as possible.He added that many encrypted asset activities will be included in the scope of supervision for the first time.Some regulations that can be expected include:
● Stablecoin, as a cryptocurrency linked to traditional assets or other cryptocurrencies, its publisher will face permit requirements to reduce the market’s concerns about the unstable financial instability of stable currencies;
● Clarify the impact of the taxation of pledge. The so -called pledge refers to the mortgage of the cryptocurrency owner to promote the transaction verification on the blockchain network and to ensure consumer rights;
● Strict review of digital assets on the cryptocurrency trading platform to prevent criminal activities in the crypto environment.These platforms may be subject to the constraints of your customers (KYC) and anti -money laundering (AML) protocols like traditional financial systems;
● Paids for users to store and encrypted assets to custody service providers need to take elastic security measures to protect users’ assets from cyber attacks and other threats.
The British Economic Minister confirmed that Britain’s goal is to attract enterprises and investors to enter this rapidly growing industry, while ensuring that consumers in the country are exempt from financial risks and fraud activities.
2. Legislative journey of British cryptocurrency ecosystem
According to data from the British Financial Behavior Regulatory Administration, only 42% of British adults in 2019 have heard of cryptocurrencies.But by 2022, 91% of British adults know cryptocurrencies.In addition, the British government expressed its intention to supervise the cryptocurrency industry in 2022.
● At the beginning of 2022 -British Prime Minister Rishi Sunak announced that the government plans to promote the British financial system to support cryptocurrency institutions and transform Britain into a leading global financial center.He said that the focus will be to support the operation, investment, innovation and scalability of cryptocurrencies and companies.
● February 2023 -In order to respond to the British government’s agenda for the British government as a global financial center, the British Financial Behavior Regulatory Administration (FCA) cooperated with the Bank of England (BOE) to start consulting the stable currency regulatory framework.These consultations are carried out according to the FCA instructions responsible for supervising the country’s encrypted environment.At the same time, the Bank of England will be responsible for supervising the operation of the stable currency provider of the British financial system due to its market size and influence.
● July 2023 -the British Legal Committee adopted four suggestions to promote the comprehensive reform of domestic crypto regulations, which may make the country regard cryptocurrencies and stable currencies as regulated financial activities.
Twelve months after taking this historic measure, Britain is expected to announce the final regulatory framework for cryptocurrencies and cryptocurrencies.However, because the upcoming election (likely to be held in the second half of 2024) may not be guaranteed.
The Labor Party is currently expected to win elections, and it has expressed a negative attitude towards cryptocurrency regulations.If the Labor Party takes over the regime from the conservative party of ruling, it may cause the aforementioned regulations to be postponed or modified before approval.If this happens, the British cryptocurrency industry may suffer the same destiny as the US cryptocurrency market, that is, due to the uncertainty of the country’s supervision, cryptocurrency users are flowing to other judicial jurisdictions.
