The UK government has pledged to introduce new regulations to regulate cryptocurrency and offer protections against scammers.
As part of its wider plan to make the UK a ‘hub for digital payment companies’, the government has announced plans to recognise so-called Stablecoins as an accepted form of payment alongside older cryptocurrencies, like Bitcoin.
Unlike some of the more established crypto, Stablecoins have a much less volatile value, being liked to traditional currencies or assets (like gold). Not only would this provide investors with a little more confidence in this emerging technology, it could also protect the vulnerable from being scammed out of their life savings.
One such individual was 77-year-old Graeme Stagg, who was tricked out of half a million pounds in less than a month from crypto fraudsters. He transferred the funds from his UK bank accounts into e-wallets, where it was withdrawn by the cyber criminals.
The government plans to use Stablecoins to protect others from a similar fate. Later this year it will consult on a number of regulations for digital currencies, then introduce new measures based on its research.
It’s not just the UK government moving to regulate the industry. Lawmakers in the US are also considering a suite of new rules amid growing fears that the crypto world is a haven for cyber criminals. There are also environmental concerns, with the ‘mining’ of Bitcoins alone thought to generate as much carbon emissions as the entire country of Greece.
Speaking ahead of the consultation, Chancellor Rishi Sunak explained: “It’s my ambition to make the UK a global hub for cryptoasset technology
“We want to see the businesses of tomorrow – and the jobs they create – here in the UK, and by regulating effectively we can give them the confidence they need to think and invest long-term. This is part of our plan to ensure the UK financial services industry is always at the forefront of technology and innovation.”
Sunak was backed up by UK Financial Services Minister John Glen, who said there was “enormous potential” for the UK to invest in crypto, to develop an ecosystem that could become a world best.
Whilst admitting that “no-one knows for sure” what the crypto world of tomorrow looks like, he said the UK aims to be “a hospitable place for crypto”, to attract investment and generate swathes of new jobs.