The Financial Conduct Authority of the United Kingdom announced at the London City Week conference that it wants to work with crypto companies. The purpose of this is to develop a regulatory framework for the crypto industry.
Sarah Pritchard, executive director of FCA, stressed the need for cooperation with the industry to ensure that the future regulatory regime for crypto assets is well developed. Pritchard acknowledged that crypto was “a one-time symbol of alternative rebellion,” but added that it ” has become more widespread. In addition, she said effective early engagement supports regulations that benefit everyone and helps businesses be prepared when regulations go into effect.
“Let’s work together to shape our rules and regulations to benefit markets, consumers and businesses,” reads the FCA website. “This is because crypto is moving from niche to mainstream.’She therefore emphasizes that crypto and the technology behind it have great potential. Crypto assets and blockchain offer opportunities for more efficient and innovative financial services and products.’
Pritchard also mentioned the warning FCA gave to crypto investors a week before FTX collapsed in November. She stated that FCA is open to innovation and that crypto assets and blockchain provide opportunities for more efficient and innovative financial services and products. However, FCA’s responsibilities are limited to ensuring that crypto companies operating in the UK comply with anti-money laundering (AML) and anti-terrorist financing (CTF) legislation.
The FCA has supported and registered 41 crypto companies of all sizes to date. However, almost three quarters of the 195 total registrations of foreign companies were rejected or withdrew their applications for a UK licence. Pritchard also announced that there will be “tangible change” in the form of legislation for crypto promotions and advertising for risky investments, as current advertising rules impose severe penalties on companies that violate them.
The FCA has worked closely with the government on its proposals to regulate stablecoins. Pritchard noted that crypto regulation was inevitable and that the regulator is trying to push through the Financial Services and Markets Act. This was introduced in July and amended in October to include crypto regulations. She added that the rules will be published after the legislation is proposed. The FCA believes that cooperation between the regulator and the crypto industry will lead to an effective regulatory framework that will help the industry thrive while minimizing risks to consumers and investors.
