A UK regulatory panel has recently recommended that retail investing in unbacked cryptocurrencies like Bitcoin (BTC) shall be treated similarly to gambling since they are extremely volatile and have no intrinsic value.
In a report published on Wednesday, May 17, the Treasury Select Committee, a cross-party group comprising the members of Parliament “strongly recommended” this treatment for the trading of digital assets.
As of now, nearly 10% of UK adults have been holding crypto assets. As per the convention, the UK government will have to respond to the report just within two months of publication.
Comparing Bitcoin investing to sports betting reflects the UK panel’s view that digital assets have “no intrinsic value, huge price volatility, and no discernible social good.
Furthermore, it will also put cryptocurrencies into the heavy tax slab as applicable to gambling. However, just like gambling businesses, crypto players will also have to verify customer identities and take measures to prevent money laundering.
The UK is not the first country to take such measures. In the past countries like Singapore have taken measures to limit retail trading in cryptocurrencies. Singapore regulators state that the volatile nature of crypto assets makes them ill-suited for most people.
While the UK tightens its grip over the crypto sector, the EU recently approved the Markets in Crypto Assets (MiCA) regulations. The EU will integrate the MiCA regulation into the country’s law over the next year. The EU has been quite ahead of other legislations when it comes to crypto regulation. On the other hand, the US has been lagging behind in introducing clear regulations in the crypto space.