Opinion by: Azariah Nukajam, head of regulation and obedience to Gemini
The UK is in a critical juncture in its approach to the rapid emerging space of digital assets.
Having been solidified itself as a financial powerhouse in the modern global economy, the government often speaks about making the UK as a “leading global hub of crypto.” Policy development is, however, slow, fragment and not ambitious enough.
The hesitation brings costs for a sector that moves fast such as crypto and decentralized finance (DEFI). Capital, talent and change are highly mobile. Dangers in the UK have lost land to more active constituents such as the US and Singapore.
To maintain competitivenessThe government must match its ambition to action while learning from international peers.
Hard ambition and slow delivery
The Financial Conduct Authority (FCA), the UK financial service regulator, and the UK government must work together to support space growth and ensure that these policies are both adhered to and achieved. The UK government is responsible for setting the legal framework, while the FCA is implementing and implementing these policies, providing guidance and time to follow them.
Clear and progressive law is important for any healthy market. One diverse example is the previous US administration, which has taken a “regulation by implementing” the Crypto industry regulating the regulating of the crypto industry, with no clear agency specified the rules by which the crypto industry is governed.
The UK government has recently suggested a draft statutory instrument (SI), a framework of forward for regulating crypto assets, hoping to create an environmentally friendly crypto within the UK. In this theory, it is a significant milestone for the UK digital asset sector. But in practice, this is just a moderate step forward for many reasons.
Continued discussion with industry participants who continue to highlight the slow speed of reform; Institutions have long awaited clarity in the UK’s stance on listed crypto products, and in August, the FCA Opened access to retail with notes exchanged by Crypto Exchange. Meanwhile, increasingly popular funds exchanged by Crypto Exchange (ETF) remain banned.
In addition, concerns about the lack of definition of regulatory boundaries for the defi-a rapid growing segment of the industry-make it difficult for crypto companies to navigate the defi and centralized finance (CEFI) perimeter.
Related: 40% of UK crypto users reports blocked payments amid increased ‘anti-consumers’ skills
Suggested legislative policies and regulations also require more reporting requirements, companies compliance teams and defeat privacy ethos associated with decentralization. Automatic HMRC tax reporting (Tax, Payment and UK’s payment and advice) is an example of this, which many are focusing on investors from using a UK-based exchange and pushing them into constituents with more favorable tax offerings.
Unless the government takes the industry’s feedback seriously and organizes to create a holistic framework that balances the care and change of consumers, the danger of being left in the global crypto race.
A dedicated regulator
On the other hand, the FCA has taken a more structured and committed approach to the UK crypto sector, showing that it is willing to engage in crypto companies to prevent market abuse and protect consumers while remaining competitive.
Unlike the government, which often appears to be reactive, the FCA has become active: the pursuit of roundtables, industrial inputs and setting a phased approach to regulatory development along its Crypto roadmap. They also provided a more detailed guide to the effective implementation of specific policies, including consumer protection, market integrity and support for responsible change. Although market participants do not agree with FCA proposals, it is important in an industry that values transparency and unpredictable and key to providing confidence in Businesses and investors in the UK.
However, the challenge lies in the FCA ensuring its policies are proportional. While large companies may absorb heavy burdens in compliance, smaller startups may struggle to comply, preventing them from running outside the UK.
A path to the leadership of Crypto
The good news is that there is still time to change the course. Other jurisdictions have already moved more decisive in their crypto regulation. EU markets in the framework of crypto-assets regulation give businesses clear and comprehensive policies to operate internally, the clarity and Genius works Put the US on the path to global crypto dominance, and Singapore’s financial authority has introduced a strict licensing process alongside sandbox regulations and pilot techniques. While a second-mover advantage will allow the UK to learn from the experiences of others, it is also a risk of leaving if they are not acting quickly to address industry concerns.
The regulator has laid out a promising foundation, and through greater coordination with the government, hard ambition and accurate implementation, the UK can put fertile land to become the leader in the global crypto economy.
Opinion by: Azariah Nukajam, head of regulation and obedience to Gemini.
This article is for general information purposes and is not intended to be and should not be done as legal or investment advice. The views, attitudes, and opinions expressed here are unique and do not necessarily reflect or represent the views and opinions of the cointelegraph.
