• The U.K. government has published a new consultation report on the regulation of stablecoins in the country, proposing a rebalancing of regulatory jurisdiction between the Financial Conduct Authority (FCA) and the Bank of England (BoE).
• Respondents want BoE to be given more power to prevent FCA from acting against service providers, while also calling for a liberal crypto market that doesn’t hinder industry growth.
• The U.S SEC and Japan are also conducting consultations with crypto investors to gather their input on regulation and potentially ease tax burdens respectively.
U.K Government’s Proposal
The United Kingdom government has accelerated consultations around regulating stablecoins in the country. His Majesty’s Treasury published a new 40-page consultation report on August 7, 2023, hinting at a possible rebalancing of regulatory jurisdiction over stablecoins between the Financial Conduct Authority (FCA) and the Bank of England (BoE). In 2022, an amendment to part five of Banking Act was proposed to include an additional “service provider” category and consequently allow the recognition of high-risk payment providers which was principally similar to FSMA 2023 enabling digital settlement assets as mode of payment.
Respondents Yearn for Liberal Crypto Industry
Most respondents vouched for BoE’s primacy to regulate stablecoins ahead of FCA, they also wanted clarity on the limitations of this power so regulation shouldn’t be a hindrance but a stepping stone to attaining a liberal crypto market.
Consultations from Other Countries
The U.S SEC is envisioning consultations with crypto investors to gather their input on regulation: Commissioner Peirce: SEC Should Ask Crypto Investors What Protections They Need Japan is aiming to ease the tax burden on crypto holders and promote industry growth: Japan Blockchain Association Urges Tax Cuts for Crypto DailyCoin Newsletter The hottest crypto news, straight to your inbox! Get a daily dose of crypto stories in a quick read with a tongue-in-cheek twist.
Bank Of England Widens Consultations On Stablecoin Regulation
The latest consultation response report has set achievable measures for legal regulation what government terms “systemically important stablecoins.“ While report proposes that BoE assumes co-supervision role over stablecoins alongside FCA, respondents want BoE given more power prevent FCA from acting against service providers. The Prudential Regulation Authority was also proposed play watchdog over FCA and prevent body from undertaking certain actions if raise irrefutable financial stability concerns.
The U.K government is currently consulting with stakeholders across different countries in order provide clarity around its proposed regulations regarding systemically important stablecoins . Respondents are looking forward possible liberalization cryptocurrency markets without hindering business growth or increasing taxes on holders .