UK to Deliver ‘Robust’ Rules for Crypto-Industry
FILE – An advertisement for Bitcoin cryptocurrency is displayed on a street in Hong Kong, on Feb. 17, 2022. Bitcoin slumped to a two-year low, Wednesday, Nov. 9, and other digital assets sold off following the sudden collapse of crypto exchange FTX Trading, which has been forced to sell itself to larger rival Binance.
InternationalIndiaAfricaThe new rules come in the wake of the wave of bankruptcies that shook the sector in 2022. The crypto industry is to be regulated in the UK following the collapse of the US-based FTX exchange late last year. The new rules outlined by the UK Treasury will ensure “robust”, transparent, and fair standards, consistent with the approach to the traditional finance industry, Financial Services Minister Andrew Griffith claimed.Cryptocurrencies are currently an underregulated industry, British experts have claimed, with companies operating in the area only needing to prevent money laundering. However, not everyone succeeds even in this. According to Britain’s Financial Conduct Authority, 80% of license applicants fail to demonstrate that they can effectively combat money laundering. “We remain steadfast in our commitment to grow the economy and enable technological change and innovation – and this includes cryptoasset technology,” Griffith stated.The new rules follow a wave of bankruptcies in the sector in 2022, which wiped $1.4 trillion off the paper value of the crypto market. The price of the bitcoin – the most popular digital currency – fell 60% in 2022. Cryptocurrency exchange FTX, which crashed in the fall of 2022, owes more than $3 billion to the top 50 investors.FTX used to be the second-largest global cryptocurrency trading platform. However, media and investors started to suspect that the company was nothing more than a financial bubble. A journalist investigation triggered a surge of withdrawals that reduced the company’s assets from billions to virtually zero and eroded $15 bn paper fortune of its founder and former CEO Bankman-Fried.The bankruptcy of FTX caused a domino effect in the crypto-industry, and other platforms were also dragged down.
