A while ago, the United Kingdom approved a bill that turned cryptocurrency trading into a regulated financial activity in the country.
Ripple‘s senior executives, Andrew Whitworth and Susan Friedman, commend the UK’s approach to the crypto industry, arguing that the country lags behind the US in terms of crypto regulations.
The executives made these statements in response to the approval of the Royal Financial Services and Markets Act, which they noted transformed crypto trading into a regulated financial activity in the country.
According to Friedman, this legislative regulation represents a significant milestone in global crypto regulations. The executive of the crypto payment company added that this law demonstrates how the UK surpasses the US in critical areas.
Ripple’s Director of EMEA Policy, Whitworth, agrees with this view and describes this move as the UK fulfilling its promise of becoming a crypto hub.
UK’s Crypto-Friendly Policy
The approval of the Financial Services and Markets Act marked the end of a comprehensive regulatory process aimed at regulating the financial sector in the United Kingdom.
While the act focuses on other matters, it includes provisions regulating cryptocurrencies and stablecoins, granting regulators the opportunity to develop a legal framework for digital assets.
Additionally, the act recognizes stablecoins as a means of payment and turns crypto trading into a regulated financial activity in the country. It also mandates strict oversight of crypto advertisements and promotions.
Challenges in US Regulation
Meanwhile, the US approach to crypto regulation is facing criticism from various crypto stakeholders.
Financial regulators such as the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) are racing to oversee the evolving field, causing confusion among market participants.
In 2023, financial regulators initiated legal actions against prominent crypto companies like Binance and Coinbase. Moreover, these two regulators faced challenges in classifying certain crypto assets as securities and commodities.
Ripple CEO Brad Garlinghouse noted that this regulatory uncertainty has led many US crypto companies to explore opportunities in foreign countries. For instance, the ambiguous regulatory environment led to several crypto companies, such as Bittrex and Paxful, exiting the US.”