The UK Government Rejects Policy Seeking to Classify Crypto Trading as Gambling
- Cryptocurrency activities have surged in the UK over the past year.
- The UK government believes the committee’s proposals could lead to overlapping responsibilities between the Gambling Commission and financial regulators.
- The UK recently passed the Financial Services and Markets Bill (FSMB) into law. The bill recognizes crypto activities as financial activities.
The UK government has rejected a new proposal initiated by the House of Commons Treasury Committee seeking to regulate cryptocurrency retail trading as it does gambling. The Committee previously argued that cryptocurrency assets lacked intrinsic value and recommended against regulating them as financial assets since doing so could expose UK investors to thinking such financial activities were safe.
Rejecting the committee’s demands, the Economic Secretary to the Treasury, Andrew Griffith, explained that such regulation would be against international standards and could push crypto activities overseas while neglecting to address some risks like market manipulation or inappropriate disclosures related to trading such assets.
The UK government further noted that the committee’s proposals could lead to conflicting and overlapping responsibilities between the Gambling Commission and financial regulators. The government, in its response, listed a couple of recent progress achieved in its bid to regulate crypto activities, including the policies established to curb illegal advertising and the recent passing of the Financial Services and Markets Bill (FSMB) into law.
Sharing further insight into its regulatory plan, the government said,
HM Treasury and the FCA [Financial Conduct Authority] will work with the industry to ensure crypto firms are fully aware of the standards required for approval at the FSMA gateway. Further communications will be provided in due course to ensure standards for approval are available to crypto firms operating in the UK.
The Gambling Act of 2005 governs all types of gambling in the United Kingdom. The UK authorities are closely monitoring organizations such as betting ships, casinos, online bookmakers, betting shops, and lotteries to prevent money laundering and reduce compulsive gambling.
The UK has made huge progress in its bid to become a crypto hub. Notably, the FSMB bill proposes clear steps to regulate cryptocurrencies and stablecoins. It also recognizes crypto trading activities as financial activities, giving crypto formal recognition in the nation.
Lawrence has covered some exciting stories in his career as a journalist, he finds blockchain-related stories very intriguing. He believes Web3 will change the world and wants everyone to be a part of it.
