The Treasury ministry of the UK intends to concentrate on regulating stablecoins rather than the cryptocurrency industry as a whole, due to the danger of private enterprises establishing dominance over the payments sector of the country.
John Glen, who is the UK Treasury Secretary for Economic Affairs stated that the government will focus mainly on regulating stablecoins. He described the threat of antagonism in the case of the growing dominance of private stablecoins in an evolving market.
“We must manage the impending risks associated with competition. Some companies can rapidly establish dominance and force out other players thanks to their capability to scale and link to current online services. We think that the need to intercede on the wider cryptocurrency markets is less pressing,” Glen noted at the City & Financial conference.
He further noted that the UK will not be suppressing innovation and imposing trade barriers concerning the leveraging of the distributed ledger technology that underlies cryptocurrencies.
“We have the rare chance to make great advances in enhancing the effectiveness of financial services and in due course benefit consumers and the economy in general,” he declared.
At the financial conference, a spokesperson for the UK’s Financial Conduct Authority asserted that it was not desirable to extrapolate the existing rules on virtual money to stablecoins, since many of them are backed by multiple currencies and other types of assets.
“Electronic money type of regulation is not best for cryptocurrencies,” concluded Alex Roy, who is the head of FCA distribution policymaking.
We remind you that previously, the UK has imposed some strict regulations on the crypto industry, including a ban on crypto derivatives.
