The UK government intends to get lawmakers to approve new legislation for stablecoins and staking within the next half-year.
Bim Afolami, Economic Secretary to the Treasury, highlighted the government’s commitment to “pushing very hard” for swift legislation on stablecoins and staking during an industry event on Monday, Bloomberg reported.
Underlining urgency, Afolami stressed the government’s stance on getting moving with a target of enacting regulations within the next six months.
Meanwhile, Coinbase’s Tom Duff Gordon anticipates new rules in the UK might exempt staking from being classified as a collective investment, Bloomberg reported.
The UK government plans to get new rules governing stablecoins and staking services for crypto assets approved by lawmakers within the next six months, Economic Secretary to the Treasury Bim Afolami says https://t.co/ltR4qahvdG
— Bloomberg Crypto (@crypto) February 19, 2024
UK Rolls Out Phased Regulatory Framework
The UK has taken a two-pronged approach to regulating crypto. In October, the Treasury released definitive proposals for overseeing fiat-backed stablecoins, specifically targeting their use in payments.
This marks the first phase of their plan, with the broader crypto asset sector set to face its own regulatory framework outlined in separate policy documents.
This staged approach allows for focused attention on stablecoins, which the government views as potentially impacting mainstream finance, while laying the groundwork for addressing the diverse dynamics of the wider crypto landscape
Fiat-backed stablecoins face regulation in two areas: usage in payments and UK-based issuance/storage.
UK Empowers Three Regulators to Rein in Stablecoins
A trio of regulatory bodies—the Bank of England, Financial Conduct Authority, and Payment Systems Regulator—will jointly oversee certain fiat-backed stablecoins under proposed regulations.
These suggestions followed a February consultation regarding the UK’s forthcoming financial services regulations for crypto assets.
A robust response to the regulations emerged, with insightful feedback from various companies and stakeholders.
While some hail the UK’s recent crypto regulation proposals as aligning with Rishi Sunak’s 2022 vision of fostering a national crypto hub, others remain cautiously optimistic.
Treasury Minister Andrew Griffith earlier expressed approval for the stablecoin framework, calling it a “step in the right direction” after months of public anticipation.
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