Good day everybody,
I hope you are all having an excellent day, welcome to CryptoGod-1's blog on all things crypto. Today I will be looking at the recent news of the UK disagreeing with a recommendation that crypto should be classified as a form of gambling.
UK Ministry Proposal
A proposal by the House of Commons’ Treasury Committee in the UK has been strongly refuted by the finance ministry, HM Treasury. Within the proposal was the aim to regulate cryptocurrency as a form of gambling. The Treasury Committee had been calling for all unbacked cryptocurrencies to be regulated like gambling, and back in May 2023 a panel of lawmakers noted that speculation in these assets “more closely resembles gambling than it does a financial service.”
However, in a document published on Wednesday the 19th of July 2023, the British Financial Services Minister Andrew Griffith noted that the Exchequer “firmly disagrees” with the proposals of the lawmakers. He noted that:
“Treating cryptos as a form of gambling would run completely counter to globally agreed recommendations from international organizations and standard-setting bodies, including the International Organization of Securities Commissions and the G20 Financial Stability Board.”
Further into the document, Griffith noted that a system of gambling regulation would likely fail to mitigate many critical risks such as the commingling of customer assets alleged of the failed crypto exchange FTX, and explained that the existing regulations in place were better placed to address these risks. These proposals would also likely do little to address market manipulation, inadequate prudential arrangements, and deficiencies in core financial risk management practices.
“A financial services regulatory framework is more appropriate for addressing the risks of unbacked crypto assets and creating the conditions for safe innovation.”
The government did make it clear that they are already working to regulate the crypto market and that a proposed regulatory legislation was with the parliament. The legislation may come into force by the end of this year, the government added. Any recommendation to rely on gambling regulation would be a departure from the Government’s intended approach, which looks at recommendations from global standard-setting bodies. These include the recommendations from the Financial Stability Board, which was recently endorsed by finance ministers from the world’s 20 leading economies. Within, it was made clear that any divergence would merely push crypto offshore.
“HM Treasury and the FCA will work with the industry to ensure crypto firms are made fully aware of the standards required for approval at the FSMA gateway.”
Have a great day.
Peace. CryptoGod-1.
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