U.K. To Regulate Stablecoins & Staking In Six Months, Says Minister

The U.K. government is planning to pass new laws to govern stablecoins and crypto staking within the next half a year, according to a Treasury official.

Bim Afolami, the Economic Secretary to the Treasury, revealed the government’s intention at a crypto event hosted by Coinbase in London on Feb. 19. He said the new legislation was a priority for the government before the upcoming general election, as reported by Bloomberg.

We’re very clear that we want to finish these things as soon as possible. And over the next six months, those things are doable.

However, Afolami did not provide any further details on the content or scope of the proposed crypto regulation.

‘”Short answer is, I don’t know […] There’s just a huge amount going on, so I don’t want to commit to that now,” he said.

The U.K. has been slow to adopt a clear and comprehensive regulatory framework for crypto assets despite Prime Minister Rishi Sunak’s ambition to make the country a “global crypto hub” in 2022. Sunak stressed the need for crypto firms to be able to “invest, innovate, and scale up” in the U.K.

However, the country has faced many challenges and uncertainties regulating the fast-growing and diverse crypto sector. Many crypto firms have complained about the authorities’ lack of clarity and guidance, especially the Financial Conduct Authority (FCA).

U.K. Legislation Targets Stablecoins

On July 3, the U.K. Law Commission issued four significant recommendations to reform domestic crypto use and ownership laws. The commission suggested creating a new “distinct” category of personal property to recognize and protect the unique features of digital assets.

It also recommended conducting a typical law analysis of crypto assets and setting up an industry-specific panel of experts to advise the courts on crypto-related legal issues.

On Oct. 30, 2023, the U.K. government announced its plan to introduce more crypto-specific regulation in 2024 and to regulate fiat-backed stablecoins under the FCA’s supervision.

The U.K. is preparing for its general election, which is expected to occur sometime in the second half of this year. The Labour government, generally seen as less friendly to crypto, is leading in the early polls.

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