The United Kingdom is amping up efforts to regulate digital currencies for safer adoption. The country’s legislative agenda for 2022 introduces two bills focused on both adopting digital currencies and cracking down on their illicit use.
The bills are highlighted in The Queen’s Speech 2022, delivered during the State Opening of Parliament and published by the Prime Minister’s office.
The first bill mentioned, the financial services and markets bill aims to make the U.K. “maintain and enhance” its position as a global leader in financial services. One of the ways it proposes to do this is by fostering the adoption of digital currencies.
The second digital assets-focused bill is the Economic crime and corporate transparency bill, which aims to crackdown on criminals and terrorists who use digital currencies to perpetrate their crimes.
One main element of the bill states that more powers will be created for law enforcement. This will help them confiscate illicitly acquired digital assets more quickly and easily, especially those involved in ransomware payments.
“Creating powers to more quickly and easily seize and recover crypto assets, which are the principal medium used for ransomware. The creation of a civil forfeiture power will mitigate the risk posed by those who cannot be criminally prosecuted but use their funds to further criminality,” the release said.
The digital currency regulations provisions in the agenda follow the country’s recent leaning towards becoming a digital currency hub. Previously, the U.K.’s Treasury announced plans to regulate digital currencies, particularly stablecoins.
According to a BBC report, Chancellor of the Treasury, Rishi Sunak, noted that the regulations would give digital asset firms confidence to enter the U.K. The Treasury is also experimenting with NFTs.
Crackdowns on digital currency firms are already ongoing in the UK
While the parliament will provide more powers for digital currency regulators, the industry is already under a lot of scrutiny in the country. This year, both the Bank of England (BOE) and the Financial Conduct Authority (FCA) have updated digital currency industry guidance.
The BOE warned that digital assets pose significant opportunities, as well as risks for market stability. These include threats to systemic financial institutions, core financial markets, and the real economy.
For its part, the FCA directed digital currency firms to comply with all its operational requirements while warning market participants to be aware of firms that do not meet the guidelines. As per CoinGeek’s report in March, the FCA probed over 300 digital currency firms for failure to comply with it during 2021.
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