Brian Quintenz, Head of Policy for crypto venture firm a16, posted a reply to the United Kingdom Treasury’s consultation on their new regulatory framework. The financial watchdog opened this process last week after announcing their “Future Financial Services Regulatory Regime for Cryptoassets.”
As Bitcoinist reported last week, the U.K. Treasury and the Financial Conduct Authority (FCA) want to launch a “robust” crypto regulatory framework. In that sense, the regulators seek input from key industry players on the proposal to “ensure the right regulatory regime.”
U.K. Wants To Overhaul Crypto Regulation
In their response to the consultation process, a16z and its Head of Policy applauded the initiative and the U.K. effort to listen to the nascent industry. In the U.S. and other major economies, the approach has been controversial and opposite to the consultation and talks approach adopted by the U.K.
The U.S. Securities and Exchange Commission (SEC) has been taking legal actions against the crypto industry and a series of measures dubbed “regulation by enforcement.” The SEC has targeted big players, such as crypto exchanges Coinbase and Kraken.
Thus, many are thinking about moving their operations abroad, and the U.S. might become the hub that will support this transition. Quintenz, formerly a Commissioner at the U.S. Commodity Futures Trading Commission (CFTC), stated the following about the consultation process:
The UK’s suggested approach looks to ensure similar regulatory outcomes for crypto and doesn’t assume that superficially related activities automatically create the same legacy financial risks and require the exact same regulatory rules.
In addition, Quintenz praised the U.K.’s understanding of the crypto market at its early stage. These financial assets have been growing over the past decade, and many believe they are still developing with much potential to improve the legacy financial system. A16z’s Head of Policy added:
(…) cryptoasset markets continue to develop with increasing pace and complexity, which brings both tremendous opportunity as well as specific, and possibly new, risks.
The U.K.’s regulators clarified that crypto could carry risk, but their new regulatory framework aims at “managing” that risk rather than suppressing the sector’s capacity to innovate. Thus, the country seeks to allow the sector to thrive in the United Kingdom.
The country’s Prime Minister, Rishi Sunak, believes in digital assets. Upon his election to office, there was speculation about Sunak’s strategy to revitalize the U.K.’s economy, and crypto and digital assets seem poised to play a role in his plan. In 2022, the Prime Minister stated:
We want to see the businesses of tomorrow – and the jobs they create – here in the U.K., and by regulating effectively we can give them the confidence they need to think and invest long-term.
Chart from Tradingview
Source: https://bitcoinist.com/crypto-giant-responds-proposed-regulation-in-the-uk/