UK Seeks to Recognize Bitcoin and Crypto as Regulated Financial Instruments

The United Kingdom has drawn a step closer to becoming one of the most recognized crypto hubs in the world as the House of Commons, the Parliament, passed the amendment to the Financial Services and Markets Bill which seeks to regulate Bitcoin (BTC) and the cryptocurrency industry.


The Bill was initially proposed when Prime Minister Rishi Sunak was the Chancellor of the Exchequer, and it seeks to regulate stablecoins. During the Parliamentary meeting, Andrew Griffith, Conservative MP for Arundel and South Downs made a proposal to expand the scope of the Bill by including other crypto assets in the scope of regulated financial services in the UK.


“The substance here is to treat them crypto like other forms of financial assets and not to prefer them, but also to bring them within the scope of regulation for the first time,” Griffith said, adding that the new clause 14 in the bill, “clarifies that crypto assets could be brought within the scope of the existing provisions” of the Financial Services Act 2000.


The MPs voted in favor of the amendments and it is now set to be presented at the House of Lords. Should the bill pass there, it will then be required to be signed by King Charles III so as to enshrine it into law.


The excitement that the UK is on track to regulate Bitcoin as a financial instrument has sent shivers down the digital currency ecosystem as evident in the price of some of the biggest cryptocurrencies, Bitcoin is up 5.97% at the time of writing to $20,561.77 per data from CoinMarketCap, while Ethereum is changing hands at $20,561.77, up 11.21%.

Many market observers are already seeing signs that the Rishi Sunak government will be bullish on crypto, riding on his positive stance on the industry while serving in Boris Johnson’s government. The timeline, however, is what remains unknown.

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UK Could Be The Next Crypto-Friendly Nation As Rishi Sunak Becomes Next PM

The United Kingdom has appointed Rishi Sunak as its newest Prime Minister after much confusion in the ministerial office over the past months.


As reported, Rishi Sunak made it the third prime minister in the UK for this year, following the resignation of Liz Truss from the office last week. The newly appointed prime minister has brought a lot of excitement to many crypto enthusiasts as they hope this would mean the UK crypto market could advance more under Sunak’s regime.


Rishi Sunak is a former Goldman Sachs analyst who has also served as a chancellor between February 2020 and July 2022. In April this year, Sunak released a proposal aiming to make the U.K a crypto-friendly tech hub. In the proposal, Sunak encouraged the UK’s Royal Mint, the official maker of UK coins, to launch an official NFT collection of the nation – an idea some have criticized as a “poorly judged gimmick.”


He also helped the U.K make plans on how the U.K government should regulate stablecoins so as to make them recognized as a legal means of payment in the country.


“We want to see the businesses of tomorrow – and the jobs they create – here in the UK, and by regulating effectively, we can give them the confidence they need to think and invest long-term,” said Rishi Sunak.


Prior to Sunak’s leadership victory, Liz Truss, who is now the former Prime Minister of the United Kingdom, announced her resignation44 days after assuming office on September 6. 


As reported by Blockchain.News, Truss’s resignation was fueled by the errors in her proclaimed mini-budget and tax cuts that were announced by the former Finance Minister Kwasi Kwarteng.


The policy, at the time, riled the markets, with the stock market recording unprecedented slumps, a trend that also affected the British Pound.

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What the UK Prime Minister’s Resignation Means for the Crypto Industry

Liz Truss, the Prime Minister of the United Kingdom announced her resignation just 44 days after assuming office on September 6. Representing an event that is not uncommon in modern democracies, the announced departure of Truss has left many wondering what the fate of some key industries will be in the near future.


In her announcement at Downing Street on Thursday, Truss said she will no longer be able to deliver on the mandate for which she had been appointed as the Prime Minister. Over the course of the next week, an election to choose the new leader will be conducted and many things will change in terms of direction for the UK.


The resignation of Liz Truss was fueled by the errors in her so-called mini-budget and tax cuts that were announced by the now-fired Finance Minister Kwasi Kwarteng. The policy riled the markets with the stock market recording unprecedented slumps which also affected the British Pound.


Surprisingly, the market has started showing signs of recovery across the board, as many are now looking forward to the ascension of a more economically versatile Prime Minister, with Truss’s contender, Rishi Sunak among the favorite candidates. 


Where is Crypto in all of This?


While it is well understood that Liz Truss does not have anything against the digital currency ecosystem and was set to continue on the positive path set by the Boris Johnson administration, her short reign as Prime Minister had not done much to make a sizable impact in the industry.


Her departure only leaves room for speculation as no one can tell who the next leader is, and whether he or she will be a positive fit to help drive the growth of the ecosystem. The uncertainty in the UK at this time might be a factor in the marginally lower growth the crypto ecosystem has experienced over the past 24 hours.

At the time of writing, Bitcoin (BTC) was changing hands at $19,046.10, down 0.8% while Ethereum (ETH) has dropped by the same percentage to $1,285.22 per data from CoinMarketCap.

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What Would the Future of Crypto Be as Liz Truss Becomes Next UK PM

Interesting times are ahead for the United Kingdom as Mary Elizabeth Truss (Liz Truss) is set to take the country’s top administrative position of Prime Minister.


Liz Truss won the election to become the Conservative Party Leader, beating Rishi Sunak, who was also a contender for the post.

With her victory, Liz Truss is set to get hands-on and build on the legacy of Boris Johnson as well as the other recent PMs from the Conservative Party in the past few years. While Liz has her own leadership visions, there has been a general silence on what is in it for the cryptocurrency ecosystem in the UK.

With the next general elections one of her major focuses, other industries are bound to feel a change one way or the other.

Liz Truss and the Crypto Agenda

Compared to what is known about the fellow contender Rishi Sunak who up to this election process was the Chancellor of the Exchequer, many may say Liz has no known agenda for crypto.

Despite this, it will be out of place to say Liz Truss is not friendly to the cryptocurrency ecosystem. She made a very promising tweet about crypto back in 2018, and her statement at the time can be attributed to someone who will welcome innovative crypto regulations.

At the time, she said the United Kingdom should “welcome cryptocurrencies in a way that doesn’t constrain their potential. Liberate free enterprise areas by removing regulations that restrict prosperity.”

There are indications that Kwasi Kwarteng, a British politician serving as Secretary of State for Business, Energy, and Industrial Strategy since 2021, will be tapped to be the next Chancellor of the Exchequer. While little is also known about Kwasi’s disposition to crypto, he is credited for fast-tracking the laws that prevent “dirty money” from being siphoned away by foreign High Networth Individuals (HNIs).

With the UK moving to recognize stablecoins as a viable means of payment, the Royal Mint is positioned to issue its first Non-Fungible Token (NFT) collections, the industry is eagerly awaiting how the milestones will unfold under Liz Truss.

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UK Treasury Officials Met with Crypto and Venture Capital Firms in Q1: Sources

UK Treasury officials engaged with crypto stakeholders for several meetings. UK Treasury disclosed a number of meetings between top officials and crypto firms during the first quarter.

According to the HMT Ministers’ Meetings log, John Glen, the former Economic Secretary to the UK Treasury, had multiple meetings in February and March with businesses in the cryptocurrency industry (including Binance, Paxos, Coinbase and Circle) to discuss crypto assets.

Glen also met with venture capital firms, such as a16z and Kingsway Capital and point of sale software provider Epos Now, with the same intentions.

In January, Glen met with Professor Barry Eichengreen, a University of California academic who has expressed scepticism toward the future of cryptocurrency in the financial ecosystem.

In March, Rishi Sunak, the former Chief Secretary to the UK Treasury and currently running a campaign to succeed Boris Johnson as Conservative leader and prime minister, met with Sequoia managing partner Douglas Leone to discuss the UK’s Venture Capital sector.

Disclosures indicated that at the end of last year, Sunak visited California State, meeting with executives from venture capital firms Sequoia and a16z and attended a roundtable meeting with crypto firms, including Bitwise, Celo, Solana, and Iqoniq.

The above meetings came before the UK announced its plan to turn itself into a global crypto hub in April. Rishi Sunak and John Glen were the architects of a campaign unveiled in April to strengthen the UK’s image as a crypto-friendly jurisdiction. That push came after years of regulatory caution that prompted several crypto firms to relocate elsewhere. 

Sunak and Glen made advances to the crypto industry in the early months of this year, meeting with executives in an effort to develop a more cohesive strategy on digital assets.

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UK Chancellor Rishi Sunak Proposes Crypto Adoption and CBDCs as Priority for Treasury Reform

Chancellor of the Exchequer for the United Kingdom Rishi Sunak has doubled down on the need to provide the ample environment for the adoption and growth of digital currencies and Central Bank Digital Currencies (CBDCs) in the nation.

Per his comments at the 2021 Mansion House speech, delivered on Thursday, 1st July, Sunak said the United Kingdom would seek to advance in financial innovations.

The Chancellor highlighted how the United Kingdom pioneered banknotes since the 17th Century, the first regulated stock exchange in the 19th, and the first Automated Teller Machine (ATM) in the 20th Century. Drawing on this, he noted that the region must maintain its lead in pioneering innovations concerning the Digital Pound in partnership with the Bank of England. Additionally, Sunak said it is “consulting on pioneering reforms to support the safe adoption of cryptoassets and stablecoins.

The United Kingdom has a strict stance on digital currencies like Bitcoin (BTC), Ethereum (ETH), and other altcoins, issuing out a recent warning against Binance and other entities and investors backing the cryptocurrency. The Chancellor also said the Treasury department is adequately reviewing the key debates in finance and tech, like the opportunities of distributed ledger technology in capital markets.

“But while I believe in the power of new technology, we also need to manage its impact on our economy and society,” says Sunak, adding that the country’s innovative drivers will reaffirm the UK’s position as the best place in the world for green finance – the final part of our vision.

While the UK is currently not an attractive place for crypto startups to build out new businesses as many countries have withdrawn their applications for approval from the Financial Conduct Authority (FCA). the UK Chancellor and other influential lawmakers will have to create the legislation that will address these concerns. Nonetheless, the Chancellor opines that the country is on track to provide this capability.

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