The Government of the United Kingdom (U.K.) has moved a step closer to regulating %Cryptocurrencies and %Stablecoins.
The British government has published its final rules pertaining to cryptocurrencies and says that it plans to issue regulations that will apply to fiat-backed stablecoins in early 2024.
Lawmakers in the U.K. say they aim to apply conventional financial regulations to cryptocurrencies, beginning with stablecoins, which are digital coins and tokens whose underlying value is pegged to another asset, typically the price of gold or the U.S. dollar.
However, the new rules are not aimed at curtailing cryptocurrencies but are rather geared towards making the U.K. a crypto-asset hub and attracting more crypto investment.
The British government has said that it wants to clarify the rules surrounding digital coins and tokens to help eliminate uncertainty and attract investment dollars.
U.K. Treasury Minister Andrew Griffith said that the final framework for crypto asset regulation will mean that “the U.K. is the obvious choice for starting and scaling a crypto asset business.”
In June of this year, the U.K. Parliament passed the “Financial Services and Markets Act 2023,” enabling cryptocurrencies to be treated like a regulated financial activity.
The U.K. government has also said that it does not intend to ban decentralized finance (DeFi), saying that it’s premature to regulate that aspect of the industry.
However, not everyone is pleased with the move to bring cryptocurrencies under existing financial rules.
Some British lawmakers have argued that treating cryptocurrencies such as %Bitcoin ($BTC) and %Ethereum ($ETH) like other financial instruments could lull investors into a false sense of security.
Some U.K. lawmakers have called for treating crypto like gambling.
The price of Bitcoin, the largest cryptocurrency by market capitalization, is currently at $34,750 U.S., having risen 110% on the year.