The Financial Services and Markets Act 2023 received royal assent from King Charles on June 29, ushering in a new era for the UK financial services industry. The new law includes cryptocurrency trading as a regulated financial activity in the UK
According to HM Treasury, this law is central to the government’s vision to promote an open, sustainable and technologically advanced financial services sector.
This law is designed to tailor financial services regulation to the unique needs of the UK market and takes advantage of the opportunities presented by Brexit. It aims to improve the UK’s competitiveness as a global financial center while delivering better outcomes for consumers and businesses.
Andrew Griffith, economic secretary of the Treasury, heralded this as a pivotal year for reforming the country’s financial services. He said:
“This groundbreaking piece of legislation gives us control over our financial services rulebook, so it supports UK businesses and consumers and drives growth.”
At the height of the FTX scandal, Griffith urged the Treasury Committee not to conflate the scandal with cryptocurrency as a whole, adding that the country must still look for opportunities in the technology under a “well-calibrated regulatory response “.
An important aspect of the law is enabling crypto regulation to support their secure adoption in the UK. It also envisages the creation of “sandboxes” to enable new technologies such as blockchain in financial markets.
The law’s implications extend to improving oversight and accountability of financial services regulators. It focuses on transparency, regular reporting and more emphasis on cost-benefit analysis. These changes are designed to facilitate the growth of the UK economy and increase international competitiveness.
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