Bitcoin and the crypto ecosystem has been branded wild west by the prominent MP’s in the UK. Also calling for the FCA to begin regulation of the current crypto markets, a report released by the parliament outlined the possible benefits which could result from responsible application of regulation.
“It’s unsustainable for the Government and regulators to bumble along issuing feeble warnings to potential investors, yet refrain from acting…At a minimum, regulation should address consumer protection and anti-money laundering.”
A report released by the Parliament of the country outlined the many risks associated with crypto which were perceived the state. Both financial and political implications such as money laundering and terrorism were discussed as current warnings provide little to no impact on guiding trading practice. The less well known problem of market manipulation was also discussed in the report. Alluding to the concepts of pump and dump practices, the report highlighted how due to the volatile nature of crypto, investors can easily misinterpret markets movements as a sign of a trend reversal etc.
Calls were also made for a scenario management to be held responsible for accounts of malicious activity. With the occurrence of malicious insider trading and volume manipulation rife among crypto trading communities, regulations would not only allow for the protection of existing investors but also provide opportunities for institutional investors to enter the expanding crypto market.
“If the government decides that crypto-asset growth should be encouraged, appropriate and proportionate regulation could see the UK become a global center for this activity. […]“Bitcoin and other crypto-assets exist in the Wild West industry of crypto-assets. This unregulated industry leaves investors facing numerous risks”
Nicky Morgan – Member of Parliament in the United Kingdom
To conclude. British MP’s have urged the FCA among committees to begin crypto regulation. TO consolidate current moves to employ regulation including input from the UK’s Treasury Select Committee and a combined taskforce made up of the Bank of England, Financial Conduct Authority and Her Majesty’s Treasury to expedite regulatory measures for financial crypto activity.