The Financial Services and Markets Act 2023 received Royal Assent from King Charles on June 29, marking a new era for the U.K’.s financial services sector. The new law includes cryptocurrency trading as a regulated financial activity in the U.K.
According to HM Treasury, this act is central to the Government’s vision to foster an open, sustainable, and technologically advanced financial services industry.
Designed to tailor financial services regulation to meet the unique needs of the U.K. market, this act leverages opportunities presented by Brexit. It aims to enhance the competitiveness of the U.K. as a global financial center while delivering improved outcomes for consumers and businesses.
Andrew Griffith, economic secretary to the Treasury, heralded this as a pivotal year for reforming the country’s financial services. He said:
“This landmark piece of legislation gives us control of our financial services rulebook, so it supports UK businesses and consumers and drives growth.”
At the height of the FTX scandal, Griffith urged the Treasury Committee not to conflate the scandal with cryptocurrency as a whole, adding that the country should still seek opportunities in the technology under a “well-calibrated regulatory response.”
A significant aspect of the act is enabling crypto regulation to support their safe adoption in the U.K. It also provides for establishing “sandboxes” to facilitate new technologies like blockchain in financial markets.
The act’s implications extend to enhancing the scrutiny and accountability of financial services regulators. It focuses on transparency, regular reporting, and a greater emphasis on cost-benefit analyses. These changes aim to facilitate the growth of the U.K. economy and boost its international competitiveness.
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