Government proposals towards regulating the crypto industry – “ensuring robust, transparent & fair standards”

On 1 February, the Treasury set out its proposals towards regulating the cryptocurrency industry.

Regulations are expected to include strengthening the rules targeting intermediaries and custodians that store crypto on behalf of customers; tougher transparency requirements on crypto exchanges, particularly in relation to disclosure documents and admission requirements; enhancing consumer protection; and "ensuring robust, transparent and fair standards".

Back in April 2022, the Treasury described the UK's ambitious plans towards becoming a global hub for cryptoasset technology. The Economic Secretary has now commented, "We remain steadfast in our commitment to grow the economy and enable technological change and innovation - and this includes cryptoasset technology".

The Treasury is currently consulting on its proposals. Once the legislation has been laid, the Financial Conduct Authority will consult on the detailed rules.

This follows the collapse of the cryptocurrency exchange FTX which has been ongoing since November 2022 and impacted around 80,000 UK-based FTX customers. FTX and recent market events - the "crypto winter" - have led to calls for regulation and for the extent and pace of implementation of such regulation to be increased.

Find further details of the Treasury's proposals at the government website.