The United Kingdom is expected to implement regulations for stablecoins within a matter of months, according to Dante Disparte, the global head of policy at Circle.
Disparte shared this view during an interview with CNBC last week, expressing confidence that formal laws governing stablecoins will soon be introduced.
“I think we’re within months, not years,” Disparte said, referring to the anticipated stablecoin regulations.
U.K.’s Takes Cautious Approach to Crypto Regulation
Disparte noted that the U.K.’s cautious approach to crypto regulation may have been beneficial, especially in light of recent high-profile failures in the industry, including the collapse of crypto exchange FTX in 2022.
He suggested that this measured pace helped the U.K. avoid some of the risks that have plagued the crypto market in recent years.
“You could also look back and argue that the U.K., along with other countries, was vindicated in not moving too quickly to regulate the crypto industry,” Disparte said.
However, he acknowledged that there is now a growing sense of urgency to bring stablecoin regulations to the forefront, particularly as the global crypto landscape evolves.
Disparte warned that the U.K. risks falling behind other regions, such as the European Union, which has already implemented stablecoin regulations under the Markets in Crypto Assets (MiCA) framework.
Singapore has also established formal laws for the stablecoin industry.
“In the spirit of protecting the U.K. economy from excessive risk, there’s also a point where you risk stifling job creation and the industries of the future,” Disparte explained.
Among the potential benefits of stablecoin regulation, Disparte pointed to advancements in wholesale banking, real-time payments, and the digitization of the British pound.
The Bank of England is currently exploring the possibility of launching a digital pound, dubbed “Britcoin” by the media.
Nonetheless, the stablecoin market remains a multibillion-dollar industry, with leading tokens like Tether’s USDT and Circle’s USDC playing significant roles in the global economy.
UK Introduces Crypto Legislation
In September, the UK government introduced a new bill aimed at clarifying the status of digital assets, including non-fungible tokens (NFTs), cryptocurrencies, and carbon credits, as “things” and “personal property” under the nation’s property laws.
The UK has been among the countries that have ramped up regulatory efforts following some high-profile bankruptcies last year.
The Financial Conduct Authority (FCA) oversees crypto activities, focusing on anti-money laundering measures and consumer protection.
Last year, the FCA implemented new rules that require crypto firms to register with the financial regulator and have their marketing materials approved by an FCA-authorized firm.
Key updates include exchanges providing clear warnings to customers about the risks associated with crypto investments.
The FCA has warned that failure to comply can result in criminal charges, including unlimited fines and up to two years’ imprisonment, for domestic and overseas exchanges operating in the UK.
As a result, leading crypto exchanges Coinbase, Revolut, and Binance have updated their mobile and web applications to comply with the new regulations.
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