The need for crypto regulation has been felt since the market has continued to see a tremendous influx of capital. The increase has continued to make it a trillion-dollar market. Though there were minor regulators rules, little attempt has been made to work on an elaborate plan for regulation. The recent bearish changes and the impacts on investors have brought made governments consider a regulatory framework for this purpose.
In a recent move, US and UK regulators held a meeting to discuss broader regulatory initiatives. They have supported each other to continue cooperation and maintain a safe environment for investors. The recent cases of collapse of Terra UST and other big names have forced states to reconsider their perspective and look for global cooperation.
Here is a brief overview of the meeting held between US and UK regulators and how it will impact the market.
Need for crypto regulation and international collaboration
The need for crypto regulation has grown more than ever because of international participation and increased investments. Recently UK financial regulator Financial Conduct Authority (FCA) announced that they have plans to collaborate with US regulators to explore crypto regulations. Nikhil Rathi, on 14 July, confirmed that their main point of discussion would be stablecoins and Central Bank Digital Currencies (CBDCs).
A week later, a joint meeting between US and UK regulators was held. The US Treasury Department published a joint statement after the meeting of the US-UK Financial Regulatory Working Group. According to the available updates, the meeting was held on 21 July, and the participants included officials and senior staff from different departments.
These included representatives from the Bank of England, HM Treasury, the Financial Conduct Authority, the Federal Reserve Board, the US Treasury Department, Commodities Futures Trading Commission, FDIC, Office of the Controller of Currency, and Securities and Exchange Commission (SEC).
According to the statement, the working group was formed in 2008 to promote financial stability, investor protection, fair markets, etc. Now, it will add crypto regulation and market innovation to its agenda as the need for these grow because of increased investments.
Joint statement from US and UK regulators
According to the statement, the regulators reflected the outcomes of the previous meeting held in June. Their main considerations were the recent market changes and steps regarding crypto regulation, especially in relation to stablecoins. While they will also work together on exploring Central Bank Digital Currencies. The participants expressed their commitment to joint efforts for innovation and regulatory outcomes across different jurisdictions.
The statement said that the participants considered further discussion regarding the developments in the near future. The regulators are aware of the global cooperation amidst the financial innovation and how further engagements can enhance their experience. The British government has expressed clarity about the recognition and legislative developments of crypto. Queen’s speech back in May outlined the details of the ‘safe adoption of cryptocurrencies.’
The UK government plans to make the country a crypto hub, and crypto regulation is a basic requisite for this purpose. They plan to work on a dynamic regulatory framework that is beneficial for both regulators and users. The Royal Mint also plans to work on NFTs along with regulating stablecoins. Last week, UK’s Law Commission published different proposals regarding crypto regulation.
UK and US governments have plans to work together on crypto regulation and related issues. According to a statement from the US Treasury Department, a joint meeting was held last week to discuss different aspects of this matter. Their main agenda was Central Bank Digital Currencies and stablecoins. The statement said that the collaboration would continue for an improved market.