Without irony, the UK Government is proposing to apply the lessons of big bank failure to cryptocurrencies.
The new proposals are set out in HM Treasury’s latest consultation paper titled “Managing The Failure of Systemic Digital Settlement Asset (including Stablecoin) Firms”.
The Government has made a firm commitment to place the UK at the forefront of cryptoasset technology and innovation.
However, the Government wants to ensure appropriate tools are in place to mitigate financial stability risk that may materialise on the failure of a major crypto firm. (For “tools” read Government powers to step in.)
So in the space of 12 months we have gone from crypto has “no intrinsic value” to it might be systemically important financial market infrastructure necessary for UK financial stability.
Client alert to follow.
Click on the link below for the full Consultation paper.