UK Chancellor announces ‘Crypto task force’, new standards to come in 2019

Phillip Hammond lays out Fintech strategy to build “pro-growth and pro-innovation regulatory environment”.

We recently reported that the UK Government was planning to further investigate the ever-growing cryptocurrency and ICO market. That announcement, made by junior finance minister John Glen, followed Bank of England director Mark Carney’s revelation that the it was actively researching a central bank-backed cryptocurrency – and seemed to hint that a new investigation would run alongside an ongoing investigation by the UK Parliament’s Treasury Select Committee.

Today, Chancellor Philip Hammond told the Treasury-hosted International Fintech Conference, that the UK government was “committed to building the most pro-growth and pro-innovation regulatory environment in the world for fintech”, and that the UK’s Financial Conduct Authority (FCA) and Bank of England would work towards automating regulatory compliance, with a view to reducing costs for firms.

Part of this plan puts flesh on some of what Mr. Glen said earlier in the week, with the announcement of a ‘cryptocurrency task force’, comprising of elements from HM Treasury, the Bank of England and the FCA that will look to explore the risks and potential benefits of distributed ledger technology. Its first report is expected as early as the summer.

Looking forward, the UK government then plans to develop standards that will make it easier for blockchain and fintech firms to strike up partnerships with traditional banks. These standards are expected to come online in 2019, with five major banks – Barclays, HSBC, Lloyds, RBS and Sanander – which appeared to commit to rolling out a Ripple-powered crypto app this year – all committed to following them.

Responding to the Chancellors initiatives, Omar Rahim, CEO of blockchain and AI energy solutions company Energi Mine said:

“The news that the UK government is launching a Crypto ‘Task Force’ is a positive sign for crypto currencies in the UK. It is important that the UK government is recognising the opportunities offered by crypto assets and not just the risks.

The simple fact is we need greater regulation at this stage. Everybody who believes in cryptocurrencies agrees that we need regulation to move forwards – nobody wants this to be the wild west anymore. With regulation comes much needed stability.

Cryptocurrencies already have millions of people invested and they certainly are not going away. Its important to remember that the first Bitcoin was mined only nine years ago, so we’re still in the early stages of the technology as a whole.

The fact that this initiative will help U.K. businesses manage the risks around Cryptoassets, as well as harnessing the potential benefits of the underlying blockchain technology, means that the UK is moving in the right direction to position itself as a world leader in cryptocurrency accessibility, integration and blockchain adoption, particularly important in a post Brexit world.”