UK to Draft a Regulatory Framework for Crypto, Stablecoins Early Next Year
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The U.K. plans to draft a regulatory framework for the crypto industry by early next year, Economic Secretary Tulip Siddiq said at a conference.
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The rules will apply to stablecoins and staking services and will end months of uncertainty for the industry.
The U.K. plans to draft a regulatory framework for the crypto industry by early next year, starting the process just as the European Union's Markets in Crypto Assets (MiCA) laws kick in across the trading bloc.
"We aim to engage firms on draft legal provisions for the crypto asset regime including stablecoins as early as possible next year," Economic Secretary Tulip Siddiq said at City & Financial Global’s Tokenisation Summit on Thursday, according to a copy of her speech obtained by CoinDesk.
The announcement follows months of uncertainty about the government's plans for the industry following its election. The previous Conservative government had put in place measures to treat crypto as a regulated activity in the Financial Services and Markets Act and had said that more rules would be coming for stablecoins and staking providers.
The new Labour government, elected in July, intends to implement its predecessor's crypto proposals on the creation of regulated activities, including operating a crypto trading platform and a market abuse regime, in full, Siddiq said. Under current plans, stablecoins will no longer fall under the U.K.'s payments regime. There will also be a carve out for staking to prevent it being treated like a collective investment scheme.
The European Union, the U.K.'s biggest trading partner, already has its crypto regulation in place. MiCA's rules on stablecoins took effect at the end of June and rest will kick in by the end of the year. Among them, the ability for crypto-asset service providers with a license in one member state being able to operate across the entire 27-nation bloc.
Read more: Labour Landslide Sets Up Starmer as UK Prime Minister With Unstated Crypto Plans
UPDATE (Nov. 22 12:14 UTC): Adds details from speech throughout, context on EU and MiCA.