A coalition of cryptocurrency related organizations has outed report warning members of the parliament about the negative influence that a wrongly formulated UK cryptocurrency regulation could have over the development of the whole cryptocurrency market. The authors of the report have stated that in this case, a bad set of regulations will be without a doubt worse than no regulation at all.
UK Cryptocurrency Regulation
A group of interested cryptocurrency parties has outed a report that criticized heavily the intention of members of the parliament of making a blunt and wide regulation for all cryptocurrency related issues. This regulative proposal presented at the parliament would have the reach of grouping bitcoin with other virtual asset classes, a thing that would send the industry into disarray.
The group that expressed their concerns about the possible approval of the law consists of the BBFA, Baker Botts, venture capital fund Novum Insights and TodaQ were all agreed on one thing: regulation must be planned with utmost care because a poorly made regulation project could have unintended consequences.
Patrick Curry, member of the BBFA declared frankly that: “It is a very blunt instrument approach and I haven’t seen this in other countries. The use of this technology is still a voyage of discovery and these technologies are being refined for different types of use. My concern is the law of unintended consequences.”
He is referring to the plan that some Mp’s have in the parliament of extending already existent laws to reach cryptocurrencies albeit narrowly.
A Poor Approach
The idea of applying the same rules that apply to stocks and other virtual instruments to cryptocurrencies could seem poor to some. Cryptocurrencies are very specialized investment instruments that need to have their own rules and regulations.
This is the thought that Neil Foster, a partner at Baker Botts has expressed also. “With sophisticated classification, we should work out what could be a regulated activity. If you crowbar everything into the Regulated Activities Order you are making everything into an investment bank.”
Currently, the cryptocurrency market is not being regulated at all in the UK, but there are growing pressures to face the issue. It is rumored that big sums of money are being spent and transferred every day, product of money laundering and also from crime-related activities. But they can do worse than what has been done till now.
Despite all this, regulations are still required to be passed for this important industry, and MP’s will have the final word about it.