Since the shock caused by the decline of the FTX exchange, the regulation of the crypto market has become an emergency for most countries around the world. First, at the G20 summit in Bali. Now, it’s the UK that plans to regulate Bitcoin and cryptocurrencies. The Governor of the Central Bank of England, Jon Cunliffe expressed the need to regulate this sector. Furthermore, he spoke about the central bank’s progress on the digital pound.
FTX collapse a reason to regulate cryptocurrencies in the UK!
It was at the Gilmore Center Policy Forum conference at Warwick Business School, on the topic of “Reflecting on DeFi, digital currencies and regulation” that Jon Cunliffe gave his speech.
In his speech, the Governor of the Bank of England returned to the need for the FCA (Financial Conduct Authority) to regulate Bitcoin and other cryptos. At the same time, he spoke about the collapse of FTX and the contagions that it has generated.
Jon Cunliffe also stated to this effect that cryptocurrencies in the UK need a more serious policy framework. Such a law could protect investors to ensure financial balance while allowing innovation in this sector.
Now, it is only a matter of time before a law regulating cryptos is implemented. The latter will allow authorities to have control over the entire cryptoasset market. Furthermore, Cunliffe announced that a consultation on the e-Pound Sterling is still underway and its development could take place at any moment.
The Digital Pound would move into its development phase
Recall that in April 2021, the Central Bank of England and the Treasury created a working group to study the potential and the risk of issuing a digital pound.
Indeed, Britain has always been patient about issuing its CBDC. In early 2022, the Central Bank and Her Majesty’s Treasury (HMT) launched a public consultation among all sectors of the British population to assess the advantages and disadvantages of the e-pound sterling.
In the statement of November 2021, the Central Bank returned to this issue. It had also clarified that no decision has been taken on the need to introduce it. Only the result of the consultation will allow the authorities to take the decision to move forward with the project or not.
In addition, the central bank has set up forums that include a portion of members from civil society, academia, the tech industry and some areas of cryptocurrency.
However, the expected result for this year will allow the authorities to decide to move on to the development phase. This phase may last for several years, until 2025 or even 2030.
The fall of FTX has exposed the failures of the regulation of the crypto industry. Unfortunately, it has become an excuse for all policy makers to take drastic measures against Bitcoin.
Coming from a journalism university background, I came across Bitcoin and cryptocurrencies not long ago.
The potential of the Blockchain seduced me and I made it my research topic.