UK Government to Regulate Cryptocurrency Industry, Formal Legislation Expected by 2024

In a significant move, the UK government has officially announced plans to regulate the cryptocurrency industry, with the goal of introducing formal legislation by 2024. This decision is part of the government's response to a consultation paper issued earlier in the year, outlining recommendations for regulating the crypto industry.

The proposed regulations aim to bring various cryptoasset activities under the same regulatory framework as banks and other financial services firms. The key focus areas include exchanges, custodians responsible for storing crypto on behalf of clients, and crypto lending companies. The government aims to establish stricter regimes for market abuse, as well as cryptoasset issuance and disclosures.

Andrew Griffith, the UK Financial Services Minister, expressed his satisfaction in presenting the final proposals for cryptoasset regulation, emphasizing the government's vision of positioning the UK as a global hub for cryptoasset technology. The government's commitment to continued collaboration with the sector reflects its determination to turn this vision into reality.

While the details of the proposed UK laws on crypto are not immediately clear, the government's move places the country ahead in the regulatory process compared to other leading nations. The European Union has set out a clear framework for digital assets through its Markets in Crypto-Assets (MiCA) regulation, incorporating a licensing process for crypto firms. The UK's decision to regulate the crypto industry signals a proactive approach to ensure a structured and secure environment for cryptocurrency activities.

The UK government aims to present the laws for the crypto industry before Parliament by 2024, demonstrating a commitment to expeditiously formalize regulations and establish a comprehensive framework for the evolving crypto landscape. This move aligns with global efforts to address the regulatory challenges posed by the growing influence of cryptocurrencies in the financial sector.