UK Financial Watchdog leader suggests the importance of international cooperation on crypto-regulation

by · July 14, 2022

The UK’s Financial Conduct Authority, or FCA, said the UK government would work with its US counterparts to adopt a regulatory framework for cryptocurrencies.

In a speech to the Peterson Institute for International Economics on Thursday, FCA chief Nikhil Rathi said the United States and Britain would “deepen ties” on cryptocurrency after discussions among regulators at the Financial Innovation Partnership on June 29. In addition, the government has. coordinated with the United States and Singapore to launch a working group for the International Organization of Securities aimed at “decentralized financial and crypto market integrity risk.”

Rathi added that the FCA did not have the power to authorize the creation of a regulatory framework for crypto in the UK, as many of the rules in the area related to Anti-Money Laundering, or AML. “We sounded the alarm over the supervision of Binance and placed restrictions on it so that it could not carry out any regulated activity in the UK without written consent,” they said:

“Many of the problems we face also require an international response. We greatly appreciate the ongoing enforcement cooperation between the FCA and US agencies, including the SEC, CFTC and DOJ in particular, which has set an important set of precedents that demonstrate the ability to act effectively on a global basis. “

“In the past, innovative companies would have asked for less regulation,” Rathi said. “Now they understand and appreciate that rules are there to provide security.”

Many regulators and legislators around the world and within the EU seem to be calling for international cooperation and coordination to address the risks and opportunities associated with crypto and blockchain. The Financial Stability Board, a global financial regulator for many countries, including those within the G20, said on Monday that it would propose international regulations for crypto and stack coins in October. In line with President Joe Biden’s executive order from March, the US Treasury Department also presented a framework on crypto where government agencies can work with their foreign counterparts.

Related: British court allows lawsuits to be filed via NFT

As the UK’s financial regulator, the FCA monitors approximately 51,000 financial services companies and financial markets across the country, including the 35 registered crypto firms it has approved to operate in the country since August 2020. As of January 2023, Hong Kong Securities and Futures Commission CEO Ashley Alder will also become the next chairman of the FCA board.