UK government comments made on 22 March at the UK Treasury’s International Fintech Conference indicate that the UK government sees regulation as a way of enabling a “stable” cryptocurrency exchange in the City of London.
UK city minister John Glen’s comments suggested that regulation could be a “significant boost” to the local cryptocurrency industry should the government be able to find an appropriate level of regulation. Although it’s unclear exactly what an appropriate level will look like in real terms, such discussions regarding boosting the cryptocurrency industry might be viewed by the industry as positive language. John Glen was quick to point out that current levels of trading activity posed no significant risk to the economy.
Speaking at the conference, the UK Chancellor of the Exchequer, Philip Hammond, launched the Fintech Sector Strategy, designed to further trading relations with Australia. A major factor in this potential partnership includes understanding emerging technologies such as blockchain and harnessing their potential.
One of the functions of the UK government’s task force will be to examine the risks of blockchain technology and mitigate these while examining the benefits of ledger technology in financial services. The Cryptocurrency Task Force, consisting of the UK Treasury and the Financial Conduct Authority has been set up for this purpose and is expected to report back in the summer with its findings.
Such calls for regulation were made last week by the Governor of the Bank of England, Mark Carney, when he discussed the impact of cryptocurrencies’ core technology indicating that he was not against innovation provided by cryptocurrencies, stating that regulation could potentially “serve the public better”. This following his comments that cryptocurrency “had pretty much failed” as a source of money.
Chancellor Hammond commented at the conference that “every hour a new tech business is founded in the UK and my aim is to make that every half hour” and indicated that the UK would open its doors to innovators and inventors. He suggested the task force as a first step towards automating financial compliance in the UK.