The British parliament acknowledged cryptocurrency as a regulated financial instrument this week, in a further move to make the UK a “cryptoasset technology hub”.
In 2021, then Chancellor Rishi Sunak announced his support for central bank digital currencies (CBDCs), saying banks across the world were looking into what a digital currency might look like in practice. He set up a taskforce to look at how they could complement cash and bank deposits, saying they would be grounded in long-standing commitments to transparency, the rule of law and sound economic governance, “bringing money into the 21st century”.
“Governments are beginning to realize that they can track this open, transparent technology and use it to follow funds and wallets around the world.”
Stefan Rust, CEO, Laguna Labs
“Governments are beginning to realize that they can track this open, transparent technology and use it to follow funds and wallets around the world. It’s been a long hard fight to get recognition for a new monetary system since the 2008 financial crisis that brought this about in the first place,” says Stefan Rust, CEO of Laguna Labs and former CEO of Bitcoin.com.
In April 2022 the government set out plans to officially recognize stablecoins and pave the way for their use in the UK. Sunak even commissioned an NFT from the Royal Mint.
The Treasury called the move “part of a series of measures to make the UK a global hub for cryptoasset technology and investment”.
Reacting to the news, the price of Bitcoin jumped from $19,300 to $20,700 over the course of Wednesday.
“Bitcoin is now recognized as a system that is open, transparent, immutable, censorship-resistant, and decentralized.”
Stefan Rust, CEO, Laguna Labs
“Bitcoin is now recognized as a system that is open, transparent, immutable, censorship-resistant, and decentralized,” says Rust. “Hopefully regulation takes these features and core assets into account and not just the coin itself, which is deemed as gold 2.0. Right now, as an asset, Bitcoin serves the purpose of an alternative investment that allows financial institutions to retain their wealth as inflation in the UK soars.”
The UK’s approach echoes moves made in the US. SEC chair Gary Gensler has made it clear his organization’s stance on crypto regulation is based on the view that crypto assets are securities, and should be registered and regulated as such.