Britain’s economics minister dismisses regulation of cryptocurrencies as gambling, and advocates for a framework for financial services

UK Chancellor of the Exchequer Andrew Griffiths has rejected Parliament’s Treasury Committee’s recommendation to regulate cryptocurrency trading as gambling, according to a response published July 20.

In a report released in May, the UK Treasury Committee acknowledged that blockchain technology could be beneficial to the financial services industry. However, she likened investing and trading in cryptocurrencies to gambling, and recommended that the industry should be regulated as such.

Griffiths argued that adopting the Parliamentary Committee’s recommendation would create conflicts with international regulators and would not adequately address the risks associated with the industry.

“The approach proposed by the commission would therefore risk creating misalignment with international standards and approaches from other major jurisdictions including the EU, and potentially create unclear and overlapping mandates between the financial regulators and the Gambling Commission.”

The economic secretary noted that international organizations, including the International Organization of Securities Commissions (IOSCO) and the G20 Financial Stability Board (FSB), have made recommendations that adequately address regulatory risks to the industry. He explained that:

“[The international bodies recommendation are] It is based on the principle of “same activity, same risk, same regulatory outcome,” which means that any crypto-asset activity that performs a similar function, and poses similar risks to those in a traditional financial system (for example, operating a trading platform or providing custodial services) is subject to regulation that guarantees equivalent results.

Griffith also stated that the cryptocurrency industry would benefit more if the appropriate financial services regulatory framework was developed to “address the risks of unbacked crypto assets and [create] Conditions for safe innovation.

Meanwhile, the government official stated that the authorities are taking proactive measures to combat misleading consumers about cryptocurrencies. Griffiths noted that the government has a dedicated regulatory regime in place for financial upgrades to crypto assets, adding that there are proposals to “ensure consumers have access to accurate information when making investment decisions.”

Earlier this month, the UK’s Financial Conduct Authority (FCA) issued a warning to crypto companies and advertisers, urging them to comply with the upcoming financial promotions scheme, which is set to be implemented in the industry by October.

UK Economy Minister Rejects After Regulating Cryptocurrency As Gambling, Financial Services Framework Defenders Appeared First On CryptoSlate.