Tougher regulation of the cryptocurrency market will come as part of the U.K. government’s measures to combat economic crime.
The U.K. government outlined plans to strengthen regulation of the cryptocurrency market as part of its overall economic crime plan, which runs from 2023 to 2026. Specifically, the innovations will allow law enforcement agencies to seize and store digital assets associated with illegal activity.
Other announced goals for the program related to cryptocurrencies include:
- passing the Economic Crime and Corporate Transparency Bill by the end of Q4 2023;
- improved communication between the Financial Conduct Authority (FCA) and crypto businesses in Q2 2024;
- coordination between the FCA and the intergovernmental Financial Action Task Force (FATF).
HM Treasury and the Home Office report that combating the illicit use of digital assets will require “robust” law enforcement oversight of the cryptocurrency market, as well as improvements in the knowledge and ability of their staff to carry out appropriate oversight.
The document notes that effective regulation is consistent with the U.K.’s desire to become an appealing global hub for businesses related to cryptocurrency assets and innovations. After introducing the announced measures, the government expects criminals to be forced to move their crypto operations to less regulated jurisdictions. According to the profile department of the National Crime Agency, the volume of illegal cryptocurrency transactions in the U.K. in 2021 amounted to at least £1.24 billion.
The Secretary of the Treasury announced the United Kingdom’s plans to become a major crypto hub back in April 2022. Strengthening control over the crypto market is a logical step in this context because at the beginning of 2023, independent researchers counted at least 168 companies in the U.K. that are accused of fraudulent use of cryptocurrency.
