The UK Treasury published a consultation paper, which sets out plans to regulate crypto trading platforms and lenders as part of its financial services roadmap.
The consultation is open for comment until April 30, aiming to give “confidence and clarity to consumers and businesses alike,” the Treasury said in a release.
It added that this approach hopes to mitigate the most serious risks of volatility and structural vulnerabilities, which have plagued some business models in the sector, bringing it in line with traditional finance.
“We remain steadfast in our commitment to grow the economy and enable technological change and innovation — and this includes crypto-asset technology,” said Andrew Griffith, economic secretary to the Treasury in the release.
“But we must also protect consumers who are embracing this new technology — ensuring robust, transparent, and fair standards.”
The UK has so far taken tentative steps to regulate crypto. The Financial Services and Markets bill, first introduced to Parliament in July by then-Chancellor of the ExchequerNadhim Zahawi included regulation of stablecoins and so-called “digital settlement assets.”
In April 2022, John Glen — the economic secretary at the time — also set out ambitious plans for the UK to become a global hub for crypto.
Regulation of exchanges has since come into sharp focus following the collapse of disgraced industry heavyweight FTX.
New rules and ‘robust standards’
New Treasury proposals will place responsibility on crypto trading venues for defining the detailed content requirements for admission and disclosure documents, ensuring crypto exchanges have “fair and robust standards.”
They will also mean tighter regulations for financial intermediaries and custodians.
Alongside these changes, the consultation will seek views on improving market integrity and consumer protection by setting out a proposed crypto market abuse regime.