Following the UK Government’s aim to establish the UK as a global hub for cryptocurrency investment the Crypto and Digital Assets All Party Parliamentary Group (APPG) initiated an inquiry to understand the opportunities and challenges in the sector.
The inquiry focused on various areas, including regulation, the role of regulators like the Bank of England and the Financial Conduct Authority, central bank digital currencies (CBDCs), consumer protection, and economic crime.
The inquiry identified that cryptocurrency and digital assets have the potential to transform the financial services system, but they need to be regulated to protect consumers and ensure investment and economic growth. The industry presents opportunities for financial services innovation, economic growth, job creation, research, collaboration, and financial inclusion.
The growth of the sector without comprehensive regulation also poses risks such as consumer protection issues, economic crime, and financial instability. Therefore, regulation is vital to mitigate these risks and harness the sector’s potential.
To become a global hub, the UK needs to develop clear regulatory frameworks and provide regulatory clarity to attract companies. The report found that the government should explore the potential of a digital pound and ensure sufficient education and awareness among the public. Regulators should have the necessary resources, capacity, and technical expertise to deliver the government’s vision.
A coordinated approach is necessary across all government departments and agencies impacted by cryptocurrency and digital assets. The appointment of a “Crypto Tsar” could help coordinate this effort. The regulation of cryptocurrency and digital assets should align with existing financial services regulations and achieve similar investor protection and market integrity outcomes.
The report provided several recommendations, including capitalizing on investment opportunities, supporting regional growth, attracting talent, improving financial inclusion, monitoring risks, keeping pace with technology developments, and considering environmental impacts. The role and approach of UK regulators need to be strengthened, and the government should ensure easy market access for UK-based businesses.
Overall, the report emphasized the need for comprehensive regulation, strategic planning, and coordination to realize the government’s vision for the UK as a global hub for cryptocurrency and digital asset investment.
In August 2022 the Crypto and Digital Assets All Party Parliamentary Group (APPG) announced an inquiry into the UK Cryptocurrency and Digital Assets sector following the UK Government’s announcement of its landmark vision to make the UK the global hub for cryptocurrency investment.
The APPG published the findings of this inquiry in its report – ‘Realising Government’s Vision for the UK to Become a Global Hub for Cryptocurrency & Fintech Innovation’ on Monday 5th June 2023.
Download the full report here
Download the summary report here
AI creation note:
This post was witten using ChatGPT which provided a draft based on the report summary. The accompanying image was generated by the Bing Image Creator.