United Kingdom Prime Minister, Rishi Sunak, first has earlier stated the intention to turn the UK into a global hub for crypto asset technology and investment. Though there has been little progress toward this goal since then, the last few months of 2022 saw a gradual shift in the right direction.
The Financial Services and Markets Bill (FSM Bill) received several digital asset-related amendments in October 2022. If this bill passes as expected, it will give FCA the authority to regulate stablecoins and other types of digital assets.
The Autumn Statement, released in mid-November 2022, demonstrated the new Chancellor’s commitment to supporting high-growth tech sectors. The Edinburgh Reforms reaffirmed this commitment in December 2022, listing specific digital asset work streams that the government was pursuing as part of its financial services reform plans.
However, the road to regulation of cryptocurrencies in the UK is going to be patchy in 2023. The UK is likely to accelerate its departure from EU payments and crypto regulations because of Brexit.
The Financial Services and Markets Bill (FSMB), which aims to give regulators more control over cryptocurrency, is expected to become law next spring. The FSMB has already been debated in the House of Commons, and its second reading in the House of Lords is scheduled for 10 January. It will then be returned to the House of Commons.
Once both houses agree, the bill will be sent to King Charles III, who can make it an Act before it becomes law. The bill may grant the Bank of England, the country’s central bank, the authority to regulate crypto used for payments and stablecoins.