UK Announces New Legislation to Regulate Crypto Assets Industry
The UK’s government has developed its first legal framework for cryptocurrency trading and exchange platforms to combat money laundering and terrorist financing.
The UK regulatory authorities announced that law enforcement agencies passed the first cryptocurrency AML measures, which would be enforced in a month. The rules require virtual asset service providers to identify customers before onboarding them. Britain’s finance minister claimed that the legal framework for the cryptocurrency moved ahead from the public consultation, and after its implementation, all crypto platforms have to register under the Financial Conduct Authority (FCA).
The European Union already approved the first crypto regulatory checks, impacting the large scale of cryptocurrency and preventing various financial and digital crimes. These rigid regulations also enforced the virtual assets platforms to set up adequate measures and comply with the latest obligation to operate in the UK. In response, the government is already working on the second framework for further clarification of the laws and to accelerate the compliance process for the crypto platforms. The EU aims to announce the second legislation in 2024. The second framework will also include measures to protect consumers from fraud and manipulation. It will also provide guidance for crypto-asset service providers on how to prevent money laundering and terrorist financing. These rules protect the cryptocurrency industry, such as Bitcoin and DeFi platforms that underpin the blockchain sector.
Implementing strict regulations is essential in the UK after the FTX scam, and these obligations will protect the global financial ecosystem. In addition, the official statement stated that the UK is still dedicated to establishing a regulatory framework that allows businesses to develop whilst preserving financial stability, enabling consumers to utilise new technology securely and dependably. The legal framework to operate the cryptocurrency will also increase the value of the virtual assets and boost confidence in digital trading platforms.
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