This Crypto Venture Giant Responds to Proposed UK Regulation
Brian Quintenz, head of policy for crypto venture firm a16, posted a response to the UK Chancellor of the Exchequer’s consultation on their new regulations. The financial watchdog opened this process last week after announcing its “Future Financial Services Regulatory Regime for Cryptoassets.”
As Bitcoinist reported last week, the UK Treasury and the Financial Conduct Authority (FCA) want to launch a “robust” crypto-regulatory framework. In that sense, the regulators are seeking input from key industry players on the proposal to “ensure the right regulatory regime.”
UK wants to overhaul crypto regulation
In its response to the consultation process, a16z and its policy chief applauded the initiative and the UK’s efforts to listen to the nascent industry. In the US and other major economies, the approach has been controversial and opposed to the consultation and dialogue approach used by the UK
The US Securities and Exchange Commission (SEC) has taken legal action against the crypto industry and a series of measures called “regulation by enforcement”. The SEC has targeted major players, such as the crypto exchanges Coinbase and Kraken.
Therefore, many are thinking of moving their business abroad, and the US can become the hub that will support this transition. Quintenz, former commissioner of the US Commodity Futures Trading Commission (CFTC), stated the following about the consultation process:
The UK’s proposed approach appears to ensure similar regulatory outcomes for crypto and does not assume that superficially related activities automatically create the same legacy financial risks and require exactly the same regulatory rules.
In addition, Quintenz praised the UK’s understanding of the crypto market at an early stage. These financial assets have grown over the past decade, and many believe they are still evolving with much potential to improve the legacy financial system. A16z’s head of policy added:
(…) Cryptoactive markets continue to develop with increasing pace and complexity, which presents both enormous opportunities and specific, and possibly new, risks.
UK regulators clarified that crypto can carry risk, but their new regulatory framework aims to “manage” that risk rather than stifle the sector’s capacity to innovate. Thus, the country seeks to allow the sector to thrive in the UK.
The country’s Prime Minister, Rishi Sunak, believes in digital assets. When he was elected to office, there was speculation about Sunak’s strategy to revitalize the UK economy, and crypto and digital assets appear to play a role in his plan. In 2022, the Prime Minister stated:
We want to see the businesses of tomorrow – and the jobs they create – here in the UK, and by regulating effectively we can give them the confidence they need to think and invest long term.
Chart from Tradingview
