The British government will soon mint its own NFT, as a part of a push toward becoming a “world leader” in the cryptocurrency space. Royal Mint, a government company in charge of minting coins, has been asked by Finance Minister Rishi Sunak, to create and issue the NFT by summer.
While John Glen, City Minister at a fintech event in London said, “There will be more details available very soon.” It is an attempt by the government to lead the way in crypto.
Steps taken in the UK to bring digital assets under more regulatory scrutiny
- As a part of the plan, certain stablecoins will be introduced into the country’s payments framework. This will enable stablecoin issuers and service providers to operate and grow in the UK
- The world-leading regime will be consulted to regulate trade in other cryptocurrencies, including bitcoin.
- The Law Commission will be asked to consider the legal status of blockchain-based communities known as decentralized autonomous organizations, or DAOs.
- Tax treatment of decentralized finance (DeFi) loans and “staking,” will be examined. This gives crypto users the ability to earn interest on their savings.
- Cryptoasset Engagement Group will be established, it will be chaired by ministers and host members from U.K. regulators and crypto businesses.
- The application of blockchain technology in issuing debt instruments will be explored.
Stablecoins derive their value from sovereign currencies like the U.S dollar, though they are controversial in the crypto world they are fast-growing. Tether is the world’s biggest stablecoin with a circulation of more than $80 billion but attracts criticism for the lack of transparency around the reserves that back the token.
The government wants to widen the spectrum and focus on other aspects of crypto, this includes Web3. Web3 is a movement that promises to bring a more decentralized version of the internet built on blockchain technology. We don’t know what the future of Web3 will be, but there is every chance that blockchain is going to be integral to its development, said Mr. Glen.
There are mixed reactions as far cryptocurrency is concerned and policymakers need to take a closer look at the $2 trillion markets. Joe Biden earlier signed an executive order urging cooperation from the government in regulating crypto. While the European Union lawmakers have voted against measures that will put the future of crypto mining at risk. Though new rules have been placed that will crack down on anonymous crypto transfers.
The UK government has been harsh on digital assets, the Financial Conduct Authority has ignored many crypto firms interested in registering with them. They said they were worried about too many “financial crime red flags” going unnoticed.
The FCA has extended the deadline for crypto businesses on a temporary register, this includes Revolut and Copper, before obtaining full authorization. Many other companies have been forced to close crypto operations in the UK and move offshore after failing to make it to the final register. So far only 33 firms have been approved by the FCA, this includes Blockchain.com, B2C2, and Wirex.