According to Odaily, the UK's Financial Conduct Authority (FCA) has launched a public consultation aimed at refining cryptocurrency regulation, as announced on December 16. This initiative underscores the FCA's commitment to developing a balanced framework that fosters innovation while addressing risks within the cryptocurrency sector. The consultation seeks to tackle pressing challenges such as market abuse, financial fraud, and unclear disclosures, which have eroded consumer trust. The proposals also aim to introduce measures that enhance transparency and ensure fair trading practices. By providing clear guidance, the FCA aspires to establish a trustworthy and sustainable cryptocurrency market in the UK, encouraging growth and long-term investment.
The FCA stated, "We also propose that certain companies, such as authorized cryptocurrency trading platforms, share information with each other to help prevent suspicious market abuse. This will reduce fraudulent activities and contribute to promoting good practices within the industry." This consultation is part of the UK government's broader strategy to establish a robust legal framework for cryptocurrencies. Building on preliminary plans announced in 2023, the framework will eventually cover trading activities, stablecoin regulation, asset custody, and more. A draft regulation is expected by 2025, with full implementation of the system anticipated by 2026. The public consultation will run from December 16 to March 14, 2025, and the FCA urges companies across the industry, legal experts, and individuals to provide feedback.
In related news, the FCA has indicated in documents concerning the forthcoming cryptocurrency regulatory regime that the UK plans to enact laws prohibiting the public offering of cryptocurrencies. These laws will draw from the UK's promotion rules, banning unregistered cryptocurrency companies from engaging with UK customers. Only crypto asset trading platforms and products that meet exemption criteria will be exempt from this restriction.