The Crypto and Digital Assets All Party Parliamentary Group published a report on June 5 with 53 recommendations to regulate cryptocurrency.
Among these recommendations, the parliamentary group proposed creating the role of a “Crypto Tsar.” The czar’s duties include coordination between various departments to ensure a “consistent approach” to crypto regulation, the party said in the report.
The UK wants to become a global cryptocurrency hub and the party advised the government to carefully weigh the risks. At this point, cryptocurrencies do not pose any “systemic risk,” the report said. But the party advised the government to continue to monitor the growth of the sector and take appropriate risk management measures as the sector scales.
The party also said the UK risks “falling behind other countries” in the race to reign in the crypto sector. The party therefore advised the government to provide legal and regulatory clarity within the next 12 to 18 months. But the party also noted that it was important to strike a balance in regulation to ensure consumer protection without nipting innovation in the bud.
The report highlighted that crypto companies in the UK are struggling to secure banking services and urged the government to find a solution quickly. The party also said that for stablecoins to emerge as a trusted new payment system, regulators must ensure they are backed by fiat currencies and other high-value assets.
To tackle scams and crimes, the party said it is important for the government to be agile and adapt to the latest techniques used by criminals. And law enforcement agencies need to be properly equipped with resources to tackle crypto-related crimes, the report said.
But most importantly, there is a need for consumer awareness. There must be a “coordinated and concerted effort by all players, including industry, regulators, law enforcement and government, to crack down on scams,” the party said.
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