Cryptocurrency market may be working towards regulatory clarity as some regulators try to make some sense out of the industry, but in reality, there is still a lot of work to be done. In fact, US Congressmen even asked the US Securities and Exchange Commission to clarify its stance regarding cryptocurrencies.
US Securities and Exchange Commission considered Bitcoin and Ethereum as commodities, while most initial coin offerings (ICO) are said to fall under security.
Regulatory changes are happening not only in the US but in different parts of the world as well. Unfortunately, not everyone has a pro-crypto stance. China, for one, has been adamant to ban crypto-related activities.
According to a UK based law firm, it will take around 24 months before crypto regulations become a reality in the UK. James Kaufmann who is the legal director at Reynolds Porter Chamberlain (RPC) UK, commented that it will take two years in order to introduce such regulation.
Though it seems a bit delayed considering how crypto regulations are already shaping up in different parts of the world, this was a conservative estimate. This was a best-case scenario where the proposals with the House of Commons Treasury Committee report starts to move forward.
RPC is a London based corporate law firm that has offices in the UK and also in Asia. It has over 80 partners and has even been named as Law Firm of the Year for three straight years since 2014. In order to make crypto regulations in the UK possible, it takes “lengthy” bills to move forward. And since the recent proposal to the House of Commons Treasury Committee (HM Treasury) has just started, it is expected that it will take such a long time to become a law.
Kauffman noted that “Bringing a complex fast-evolving area like cryptocurrencies into a regular framework is going to be difficult and lengthy process. Added to this, big issues like Brexit are already occupying a lot of regulator’s time”.
Considering the past incidences wherein regulatory changes were made of lesser magnitude, it seems that a 24-month estimate is actually quite ambitious. He said that “Past precedents show it can take years to make relatively minor regulatory changes to the financial regulatory regime. For example, it took two and a half years from the Treasury’s original announcement (10 May 2004) for the regulation of home reversion plans to come in force (6 November 2006)”
It is important for the Treasury Committee to take a closer look at the industry and know every “specific activities related to cryptocurrencies”. This will then involve time to draft a proposed regulation and even do a consultation period to those that will be affected by the regulation. And then, it will be published and then implemented.
2018 was marked by a number of regulatory changes all over the world. This was a reaction by regulators right after Bitcoin reached near $20K starting from just around $1,000 in 2017. UK lawmakers even called the crypto market a “wild west” industry. Now, could it be possible to have significant regulatory changes in the UK in a matter of 24 months? Or will this need more time?
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