Markets are reflecting positive sentiment after Rishi Sunak took over as UK Prime Minister.
While Sunak indicates spending cuts to lead the fiscal recovery, a big delivery is expected from him to turn the UK into a “crypto hub” as he promised.
Earlier in April, the UK government had made a series of crypto overtures with Rishi Sunak leading the brigade as Chancellor of the Exchequer, along with former Treasury Secretary for Finance (Sept 2021-July 2022), John Glen.
Sunak had signaled his ambition to make the UK a global hub for crypto asset technology while ensuring that “businesses can invest, innovate and grow in this country.” He added that Glen confirmed a more comprehensive regulatory consultation with the government around the cryptocurrency sector before the end of 2022.
Can Rishi Sunak Deliver on His Crypto Promises?
With the re-election of John Glen as Chief Secretary of the Treasury on October 25, 2022, the crypto market has reason to rejoice.
Jamie Burke, founder and CEO of UK-based venture capital firm Outlier Ventures, told Bloomberg that, “This change in leadership could prove crucial to achieving the aspirations that were set out earlier this year in around the transformation of the United Kingdom into a world-renowned financial center.”
Still, Burke warned that “proactive action to provide effective and timely regulation for the sector” must be implemented in time.
In a speech on November 9, 2020, Rishi Sunak also suggested that stablecoins and central bank digital currencies would offer more effective payment processing networks. Meanwhile, Britain is pushing crypto asset regulations through parliament.
New Policies amid EU Push for MiCA
On October 27, Andrew Griffith, a Sunak-appointed city minister, tabled the amendment to the Financial Services and Markets Bill in parliament. The parliamentary memorandum read as follows:
“This new clause amends the Financial Services and Markets Act 2000 to clarify that powers related to financial promotion and regulated activities can be relied upon to regulate crypto assets and crypto-asset-related activities. Cryptoasset is also defined, with the power to modify the definition.”
Furthermore, with members of the House of Commons voting in favor of the plan, the proposal could soon become law. And as the European Union is close to passing historic crypto rules under MiCA, Rishi Sunak is expected to speed up work in some key areas.
Another task for Rishi Sunak, according to crypto industry executives, is to speed up a licensing process for companies operating in the digital asset sector.
With Rishi Sunak known to advocate for the cryptocurrency market, the Treasury and Bank of England have been exploring the feasibility of a potential UK CBDC amid pressure for more stablecoin regulations.
By Audy Castaneda
