Introduction
The United Kingdom has achieved a significant milestone in the realm of digital assets as it officially passed a bill recognizing crypto as a regulated financial activity within the country. The Financial Services and Markets Act 2023 has been enacted into law, signifying the government’s commitment to fostering an open, sustainable, and technologically advanced financial services sector. This momentous development holds great importance for the digital asset industry in the UK.
UK Crypto Bill Receives Royal Assent
The UK has reached a pivotal point in its regulatory framework by passing a bill that acknowledges crypto as a regulated financial activity. This represents a crucial turning point as regulators now possess the authority to govern the digital asset industry, including stablecoins. The bill successfully completed the legislative process, culminating in the royal assent granted on Thursday.
Significance of Royal Assent
Royal assent is a vital procedural step for legislation to become law in the UK. With the royal assent, the Financial Services and Markets Bill has now transformed into an Act. The bill had already gained approval from the Chamber of Parliament, and its final approval was granted by King Charles.
Government’s Perspective
Andrew Griffith, the Economic Secretary of the Treasury, expressed his thoughts on this momentous decision, emphasizing that the legislation empowers the UK to have control over its financial services rulebook. This autonomy will benefit UK businesses and consumers while fostering economic growth.
Expansion of Regulatory Authority
Initially introduced in July 2022, the bill introduced a significant reform to the power of regulators over the financial system. Now, it bestows them with the regulatory power to govern the digital asset industry as well. Notably, the UK Treasury, Financial Conduct Authority, Bank of England, and the Payments System Regulation Authority are authorized to establish and enforce regulatory rules in the industry. The formulation of these rules is expected to commence soon, with Andrew Griffith suggesting that crypto sector regulations could be implemented within the next 12 months.
Conclusion
The UK’s recognition of crypto as a regulated financial activity marks a milestone in the country’s financial landscape. With the bill’s passage, the UK is poised to develop a robust and well-regulated digital asset industry, aligning with its vision of fostering an open and technologically advanced financial services sector. This move signifies the UK’s commitment to embracing the potential of digital assets while ensuring consumer protection and driving economic growth.
