Crypto regulation: what next? – FTAdviser

With the recent amendments to the Financial Services and Markets Act 2023, the UK government is taking some initial formal steps to regulate the crypto sector.

The amendments, some of which will come in to force in October this year, are widely considered as an entry in the statute book that starts to give some clarity about the regulatory framework for digital assets and crypto companies, in respect of registration requirements and financial promotions.  

Globally, market participation in crypto has continued to grow at both retail and investor level. However, regulators worldwide have been slow to introduce comprehensive – and coordinated – measures to protect investors.

Similarly, crypto companies have had to navigate uncertainty surrounding the regulations that do, or do not, apply to their business and services, and the challenges that come with operating a business across multiple jurisdictions with inconsistent, or non-existent, regulations.

In the aftermath of the high-profile collapse of FTX, and noting the Securities and Exchange Commission complaints recently filed against Binance and Coinbase in the US, it is a timely and welcome step towards managing the risks and providing some clarity to companies operating in this rapidly developing sector.

With any regulatory developments, there is an inevitable learning exercise as the market responds.