The UK is on a journey to come up with balanced and appropriate regulations to manage the cryptocurrencies in the country. While the industry is getting bigger and more mainstream the disconnect between the crypto companies and the regulatory bodies is still very much present.
The main issue that all countries face when it comes to regulating crypto is that the industry is just not cut out for the way these systems function under centralized authority. While the crypto thrives in a decentralized and private environment the regulations that usually dictate the course of other financial actions are simply incompatible with the most basic demands of the crypto users.
This is not an issue exclusive to the U.K, far from it, but there is a sheer lack of willingness from most of the regulatory bodies to consider the unique needs of the crypto market. It has become an ongoing battle between the crypto companies and the government officials or other regulators, with none of the sides willing to compromise.
It has opened the eyes of many of the incompatibility of the crypto market with the existing laws and regulations.
What has been a hopeful turnaround is that the countries, willing to make the changes to ensure not only the proper functioning of the crypto market but also the safety and security of its users through regulations.
The U.K taking the crypto initiative
One of the countries leading this movement is the U.K, where cryptocurrencies took off almost immediately and have been evolving ever since. The country has lowered the payment requirements for crypto firms.
According to the changes made to the regulations, the firms with net income of less than 250,000 will only need to pay 2,000, while those with income more than 250,000 will be paying 10,000.
This move has halved the number of payments that were required before the changes and has overall created a more crypto-friendly environment, allowing the industry to develop and engage with customers more freely and without additional taxes.
The U.K’s Financial Conduct Authority came up with this plan after the continuous requests from the U.K crypto scene companies, who felt like the payment were unnecessarily large and have been asking for more favorable conditions for a while.
The U.K authorities were finally ready to take the steps towards more harmonized relationships with the crypto funds in order to promote the growth in the industry and possibly increase the adoption levels of cryptocurrency. The crypto industry has been at the center of attention of the U.K, for a while, with some of the best forex brokes in the U.K taking interest in trading crypto and making it more accessible. The recent changes to the regulations will make this process a lot easier.
More to be done
While this is no insignificant step, there is still a lot to be done in regards of making cryptocurrency more user-friendly, but with that being said the U.K is definitely among the leaders in this direction and is setting an example for the countries who want to see the benefits of cryptocurrency but are unwilling to give the crypto companies a break.
While everyone agrees that the potential of cryptocurrency and bitcoin are great and could take the payment methods to another level, as the market is still relatively new, at least compared to other financial institutions and their services, it is hard to get over the initial fear for some of the regulators.
There have been cases where the authorities go out of their way to make it impossible for the crypto funds to function in their country, introducing ridiculous tax rates and looking for creative ways to stunt their growth. This approach can only bring negative results because the demand for this novelty is already very strong among the people and suppressing it won’t end well for anyone involved.
What the U.K is doing is the perfect way to start taking these companies seriously and to let them do their jobs and be the medium for those wanting to get into cryptocurrencies while countries continue to work on the development of more appropriate security systems to make people feel more inclined to use this method.
An example to follow
The U.K’s more has made it easier for new companies to enter the market but it has made the payment higher for the bigger companies, which seems like an appropriate middle ground since they don’t want to see monopolized crypto scene and want to involve other players as well.
With that comes the great responsibility of making sure that the companies that will be entering the U.K’s crypto market are safe and dependable which is something the country plans on dedicated a lot of its attention to. There are already regulations in place for the companies to be granted the right to operate in the U.K, so the security aspect of it will likely be well-taken care of.
FCA has already announced that it will be making sure that no money laundering is taking place and will be watching the market for any signs of criminal activity, focusing on terrorist funding, which is a huge problem associated with the industry all around the world.
The security tools directed at the crypto industry are getting more advanced so in the future, we will see the increase in the overall safety levels, which will, in turn, attract more people to cryptocurrencies and will increase its adoption worldwide. It took a lot of crypto crimes to realize that the safety mechanisms need to advance with the technology to ensure that those familiar with the market can’t use their knowledge against it.
This is very important news for the crypto community that will hopefully set a new trend that will be shared by many in the near future.
There have been a couple of countries that have expressed the desire to work closely with crypto companies, so this could serve as a prime example of a regulatory body taking into account the requests of the crypto firms and changing the existing regulations to better for the industry. It seems like the authorities are finally ready for the compromise.