UK Treasury Proposes New Crypto Rules to Combat Scams and Fraud
New Framework for Crypto Exchanges and Dealers
United Kingdom Treasury and Chancellor of the Exchequer Rachel Reeves introduced a set of draft rules to regulate the crypto market more tightly on April 29. The draft legislation targets cryptocurrency dealers, exchanges, and agents, bringing them into a regime designed to better protect customers and encourage innovation.
Following the Treasury’s announcement, the step is aimed at addressing the increased number of residents in the UK engaged with cryptocurrency like Bitcoin (BTC) and Ether (ETH). The government officials emphasized concern over exposing people to unregulated and dangerous companies and a surge in scam cases and fraud related to the digital assets.
The UK must remain receptive to innovation, but not at the cost of consumer protection,” the statement read. “Today’s announcement sends a clear message: Britain is open for business — but closed to fraud, abuse, and instability.”.
Under the new regulations, crypto exchanges will have to implement stricter anti-fraud measures, improved disclosure requirements, and sufficient warnings to investors regarding risks. Regulators will also be granted enhanced powers to crack down on rogue firms in Britain.
Working with the United States and Next Steps
The UK government statement also referenced ongoing talks with US counterparts for cross-border regulatory cooperation. Specifically, it referenced cooperation with SEC Commissioner Hester Peirce on a planned US-UK cross-border sandbox — an effort aimed at allowing firms to test crypto-related products and services in a regulated manner across both markets.
This global coordination aims to harmonize global crypto markets and reduce the tendency towards regulatory arbitrage, when firms relocate activities to places with more lenient regulations.
The Treasury has said that it will introduce final legislation “at the earliest opportunity” after additional consultation with industry stakeholders. Firms and regulatory experts are invited to provide comments on the proposed rules to guide the ultimate legal regime.
The UK’s approach is one of a larger global trend of governments seeking to reconcile the promise of blockchain technology with the need to address consumer protection risks. With the growth in cryptocurrency use, lawmakers around the world are moving quickly to protect financial stability and market integrity.
By tightening the rules now, British authorities hope to create a safe environment for innovation to flourish without allowing criminal forces to chip away at trust in the financial system.
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UK Treasury Proposes New Crypto Rules to Combat Scams and Fraud
New Framework for Crypto Exchanges and Dealers
United Kingdom Treasury and Chancellor of the Exchequer Rachel Reeves introduced a set of draft rules to regulate the crypto market more tightly on April 29. The draft legislation targets cryptocurrency dealers, exchanges, and agents, bringing them into a regime designed to better protect customers and encourage innovation.
Following the Treasury’s announcement, the step is aimed at addressing the increased number of residents in the UK engaged with cryptocurrency like Bitcoin (BTC) and Ether (ETH). The government officials emphasized concern over exposing people to unregulated and dangerous companies and a surge in scam cases and fraud related to the digital assets.
The UK must remain receptive to innovation, but not at the cost of consumer protection,” the statement read. “Today’s announcement sends a clear message: Britain is open for business — but closed to fraud, abuse, and instability.”.
Under the new regulations, crypto exchanges will have to implement stricter anti-fraud measures, improved disclosure requirements, and sufficient warnings to investors regarding risks. Regulators will also be granted enhanced powers to crack down on rogue firms in Britain.
Working with the United States and Next Steps
The UK government statement also referenced ongoing talks with US counterparts for cross-border regulatory cooperation. Specifically, it referenced cooperation with SEC Commissioner Hester Peirce on a planned US-UK cross-border sandbox — an effort aimed at allowing firms to test crypto-related products and services in a regulated manner across both markets.
This global coordination aims to harmonize global crypto markets and reduce the tendency towards regulatory arbitrage, when firms relocate activities to places with more lenient regulations.
The Treasury has said that it will introduce final legislation “at the earliest opportunity” after additional consultation with industry stakeholders. Firms and regulatory experts are invited to provide comments on the proposed rules to guide the ultimate legal regime.
The UK’s approach is one of a larger global trend of governments seeking to reconcile the promise of blockchain technology with the need to address consumer protection risks. With the growth in cryptocurrency use, lawmakers around the world are moving quickly to protect financial stability and market integrity.
By tightening the rules now, British authorities hope to create a safe environment for innovation to flourish without allowing criminal forces to chip away at trust in the financial system.
Read More
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