Parliament's upper house has passed the Financial Services and Markets Bill, which includes language that would regulate cryptoassets.
COVER ART/ILLUSTRATION VIA CRYPTOSLATE
The United Kingdom’s House of Lords passed the Financial Services and Markets Bill today, marking a major step in the country’s effort to regulate crypto-assets and their providers.
Introduced on July 20, 2022, this legislation could impact the cryptocurrency markets considerably. With the endorsement from the House of Lords, the bill is now one step closer to becoming law.
Introduced last year to leverage post-Brexit opportunities and empower financial regulators, the FSMB initially included a provision for regulating stablecoins under national payment rules. However, as the bill advanced through Parliament, amendments were incorporated to treat all cryptocurrencies as regulated activities, along with measures for overseeing crypto promotions.
The bill, a follow-up to the Government’s “Future Regulatory Framework” review, is seen as a comprehensive agenda for substantial shifts across the financial services sector, including the repeal and replacement of all laws and regulatory requirements stemming from EU measures in the wake of Brexit.
Of particular interest to the cryptocurrency sector is the legislation’s provision for regulating crypto-assets and their providers. This novel development in UK law represents an earnest attempt to introduce regulatory supervision into an industry known for its laissez-faire attitude. The move is expected to bring greater transparency and stability to the often volatile cryptocurrency markets.
The bill also sets out to regulate ‘Buy Now Pay Later’ products and their providers, with the aim of enhancing consumer protection. Simultaneously, it guarantees the maintenance of access to cash, which is essential for demographics that still rely on physical currency.
Furthermore, it introduces the prospect of mandatory reimbursement for victims of Authorised Push Payment (APP) scams. APP scams have been a prevalent issue in the UK, with the bill targeting tighter controls on those who approve financial promotions for others, thereby bringing more accountability to the financial ecosystem.
As the bill continues its journey through the parliamentary process, several consultations on its provisions are underway. Some aspects are expected to incite intense debate, while other provisions are likely to be promptly integrated into the regulatory system.
BY Jacob Oliver | Origianl From