John Glen MP told journalists: "We remain agnostic and are engaged in trying to find the right narrative and the right level of regulation."
- The UK government announced a crypto task force on Thursday.
- John Glen MP said: “We remain agnostic and are engaged in trying to find the right narrative and the right level of regulation if that’s appropriate.”
- He said there could be a “flourishing” crypto exchange in London if the government gets it right.
- The current level of cryptocurrency trading doesn’t pose a risk to the UK economy, City Minister said.
LONDON — Cryptocurrencies don’t pose a risk to the UK economy and any regulation of the sector will be “proportionate,” according to Britain’s City minister John Glen.
British Chancellor Philip Hammond announced a new cryptocurrency “task force” on Thursday, featuring representatives from the Treasury, the Bank of England, and the Financial Conduct Authority, the UK’s regulator. The task force’s mandate is to “manage the risks around crypto assets, as well as harnessing the potential benefits,” Hammond said.
Speaking on the sidelines of the Treasury’s International Fintech conference on Thursday, John Glen MP told journalists: “We are seeing great excitement, some wariness, and also I think some misunderstandings. We remain agnostic and are engaged in trying to find the right narrative and the right level of regulation if that’s appropriate.”
Cryptocurrencies have exploded in popularity over the last year and the global market is now worth over $300 billion. Regulators and governments around the world have been scrambling to catch up, with many left flat-footed by its rapid growth.
“The issue is, how do we regulate or not, how do we enable or not, based on the blend of opportunities and risks that may exist in this new technology,” Glen said.
Stressing the opportunities, he added: “Regulation could be an enabler of a stable, flourishing cryptocurrency exchange in the City of London.”
Cryptocurrency exchanges have sprung up across the US and Asia but there are as yet no meaningful UK players in the market, although startups such as the London Block Exchange are trying to change that.
The largest exchanges turn over hundreds of millions of dollars a day and crypto startups have raised billions. Some jurisdictions such as Switzerland and Gibraltar have taken an accommodative approach to regulation in a bid to get a slice of the burgeoning industry. Others, such as the US and China, have sought to rein in the market, which has been plagued by scams and security breaches.
Glen said: “I think it’s right that we take appropriate — not really cautious, but proportionate — steps to evaluate it before we act as a government.”
The junior minister said he expected the task force to deliver early findings “in short order.” “We don’t want this to be kicked into the grass,” he said.
He said the government is “conscious that there’s a lot of interest and activity in this space” but added: “I’ve had initial guidance that at the moment the scale of the activity in the UK — cryptocurrency trading, blockchain technology — is not posing any significant risk to the UK economy.”