APPG Co-Chair Urges UK to Accelerate Crypto Regulation in Lords Debate
During a recent House of Lords debate on the potential risks to the UK financial system arising from the loosening of cryptocurrency regulation in the United States, Lord Vaizey of Didcot argued that the greater risk lies in failing to regulate the sector effectively in the UK and called for the UK to accelerate efforts to bring forward a comprehensive regulatory framework for crypto.
Lord Vaizey, Co-Chair of the Crypto and Digital Assets All-Party Parliamentary Group (APPG) in Westminster, which is supported by CryptoUK as its secretariat, told Parliament that in his view “the risks around crypto are in fact the risks of not regulating crypto.” He noted that one in four people in Britain are now trading cryptocurrency, with half of them under the age of 35, and said that regulation “has never been more needed.”
He framed the issue as one of urgency, stating: “In essence, the key issue is time: we need to get on with it.”
Responding on behalf of the Government, Lord Livermore, Financial Secretary to the Treasury, paid tribute to Lord Vaizey’s expertise in the area and said that cryptoassets have the potential to play a significant role in financial services and the wider economy, including through improvements in transparency, efficiency and security.
The Government Minister highlighted the benefits already being seen from stablecoins in cross-border payments, including reduced costs and improved efficiency, and noted that unlocking the full potential of digital assets and blockchain technologies requires payment mechanisms that can interact directly with them. Stablecoins, he said, can play an important role in achieving that.
Lord Livermore agreed on the need to bring forward legislation and confirmed that the Government will legislate this year for a cryptoassets financial services regulatory regime, with the Financial Conduct Authority as the lead regulator. He said the objective is to ensure consumer protection while providing firms with the certainty required to invest and grow in the UK.
He also said that the UK is engaging with the United States on cryptoasset risks through international fora and referenced the creation of a joint UK-US Transatlantic Taskforce for Markets of the Future to enhance collaboration on digital assets.
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