NFT Inquiry Filed by UK Parliament Group as Crypto Scrutiny Rises

• DCMS announced that it will also investigate the underlying blockchain technology that supports NFTs.
• According to the DCMS committee’s statement, NFT regulation in the UK is mainly non-existent.

The UK government has started a probe into nonfungible tokens (NFT), digital collectibles championed by Prime Minister Rishi Sunak. The House of Commons Digital, Culture, Media, and Sport committee announced the initiative in a statement on Friday, adding that it will also investigate the underlying blockchain technology that supports NFTs.

DCMS committee stated :

MPs are expected to consider whether NFT investors, especially vulnerable speculators, are put at risk by the market.

The popularity of the Bored Ape Yacht Club collection, which became a favorite with celebrities, propelled NFTs into public notice in 2021. However, interest in NFTs has dwindled this year as crypto assets have fallen, with trading falling by more than 95% between January and September, according to one estimate. As per DCMS committee’s statement, overvalued assets may be dumped on ‘bigger fool’ investors, and NFT regulation in the UK is non-existent. 

Sunak’s Support for Crypto

Sunak, who took over as Prime Minister last month following Liz Truss’s brief and turbulent term, was a strong crypto proponent when Chancellor of the Exchequer. In April, he recommended regulatory reforms for stablecoins. Sunak has also shown support for central bank digital currency. He directed the Royal Mint in April to create a nonfungible token (NFT) by the end of the year as a representation of the forward-thinking approach the UK is determined to pursue. Sunak has created history for a variety of reasons. He is the youngest prime minister in modern British history, at 42 years old.

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