The British government is considering regulations to regulate the cryptocurrency market in order to allow the growth and development of this market while protecting users and their funds. The British Treasury’s proposals to control this market will include measures to prevent fraud and create a transparent and fair platform for the growth of cryptocurrency projects.
The plan that the American government has considered to regulate the cryptocurrency market and will be published in full today, is supposed to be discussed for three months. This plan ensures that in case of bankruptcy of cryptocurrency businesses, users’ funds are returned to them. In addition, rules will be established to ensure that the advertising of crypto assets is fair and transparent and not misleading.
Now, according to a report, the British government wants to increase the requirements for reporting information about these projects and strengthen the relationship between these businesses and regulators. Also, this government is going to set regulations to prevent bubble processes in these assets. Many of these projects inflate the value of an asset and then sell it to unsuspecting users.
The Treasury Department says these regulations will reduce most of the significant risks in the digital currency industry while preserving the benefits of using these assets.
The cryptocurrency market is under the pressure of regulators more than before
Since the crypto market crash of 2022, calls for regulation have doubled. In the last year, billions of dollars of capital were destroyed and many scandals occurred. This issue attracted more attention especially due to the bankruptcy of FTX exchange.
Currently, some supporters of cryptocurrency technologies believe that part of the advantage of these assets is their independence from traditional financial networks, so legislation for this area will not benefit this technology. But others believe that until there are proper regulations in this market, it cannot be expected to fully flourish.
The British government is going to consult with experts about its proposed regulations by May 10 and then send this plan to the parliament.