Wednesday saw the introduction of the Financial Services and Markets Bill into the United Kingdom Parliament. The comprehensive bill, which was meant to preserve the U.K.’s leading place in the financial world post-Brexit, repealed The bill retained EU laws and reformed some insurance laws. It also supported victims of financial crime and set new growth- and competitiveness targets. The bill also regulates stablecoins.
In the programmatic speech, the programmatic speech confirmed that the bill contained stablecoin regulation. delivered By Nadhim Zahawi, hancellor at the Exchequer. Although stablecoin regulation was intended to be part of the bill from its inception, the fate of that regulation had become a matter of concern for some observers after the recent upheaval in crypto markets and the departure of pro-crypto members of the government earlier in July, which included Economic Secretary to the Treasury John Glen and Zahawi’s predecessor Rishi Sunak.
2. Cryptoasset technology is being used to create a stablecoin scheme and make it easier for UK citizens to use a wider variety of payment methods. pic.twitter.com/OByPNFQJh0
— HM Treasury (@hmtreasury) July 20, 2022
The bill extended the Banking Act of 2009 and Financial Services (Banking Reform) Act of 2013 to cover “digital settlement assets” (DSAs) and authorized the Treasury to regulate DSAs, payments made with DSAs, DSA service providers and DSA insolvency arrangements. These regulations will also be approved by the Financial Conduct Authority (FCA), Bank of England and other regulators, as needed.
Jon Cunliffe (Bank of England deputy governor, financial stability), has made repeated calls for more regulation of cryptocurrency. He has a history of crypto cynicism and has called for increased regulation. He compared the current cryptocurrency regulatory framework to “unsafe aeroplanes” in a speech on July 12, pointing specifically to the collapse of Terra (LUNA) — now called Terra Classic (LUNC). The FCA registers companies that provide crypto services. Numerous contenders have found it difficult to obtain this registration.
Related: Former Chancellor claims the UK is falling behind in crypto opportunities
Before the bill can become law, it must pass two additional readings in House of Commons.