In a document released on Thursday, the U.K. government rejected legislative proposals to regulate cryptocurrencies like gambling, claiming that its current ideas better handle the risks posed by occurrences like the FTX crash.The Treasury Committee of the House of Commons voiced worry in May that government planned to treat the cryptocurrency industry too leniently, leading individuals to believe that investing in bitcoin (BTC) or ether (ETH) is secure, by using standards that are generally comparable to those for traditional finance.According to the Treasury answer, “The Government firmly disagrees with the Committee’s recommendation” regarding retail crypto trading and investing.
According to the government, “a system of gambling regulation, in isolation, would be unlikely to address these risk factors” like the alleged mixing of customer funds at cryptocurrency exchange FTX or address issues with insider trading and market manipulation that are dealt with by conventional financial regulation.
“The recommendation to rely on gambling regulation would represent a fundamental departure from the Government’s intended approach which reflects recommendations from global standard-setting bodies,” the government said,citing suggestions from the Financial Stability Board that the 20 largest economies in the world’s recent endorsement of their finance ministers, and warning that divergence would only drive cryptocurrency offshore.
The U.K.’s financial sector has cautioned that its rulemaking is lagging behind other jurisdictions like the European Union. In 2022, Rishi Sunak, then finance minister and now prime minister, stated that he wants to become the country a centre for cryptocurrency.