British regulators extend an olive branch to Bitcoin, and the regulatory environment becomes more relaxed

Author: sanna

Christopher Woolard , director of strategy and competition at the UK Financial Conduct Authority ( FCA ), announced for the first time that a series of regulatory measures would be issued against fintech companies. Harriett Baldwin, the Treasury's economic affairs secretary, announced a friendly relationship with digital currencies such as Bitcoin.

Both were speakers at the Global Innovative Finance Summit in London. As Christopher Woolard said in his seminal speech, the aim is to test their innovative ideas and prevent the regulatory consequences that have come before.  

FCA may relax regulations  

Regulated companies and start-ups will receive guidance on the FCA’s interpretation of the terms, and they must reach a consensus: if they follow the guidance, they must obey. The FCA may subsequently suspend or modify the regulatory terms, or even issue a “non-mandatory action”, which is actually a waiver of the FCA ’s terms and regulations during the regulatory stage. Of course, civil and criminal legal liabilities are still valid. Woolard explained:

"If these companies are upfront with us, maintain established testing standards and are honest with customers, we will give them some concessions and we will not take disciplinary action if something unexpected happens."  

Similar to accelerator  

The regulatory measure is considered to be highly innovative and open, and Woolard said it is like an accelerator, producing two similar measures a year. In addition, the FCA is planning further measures and announced that an industry working group will explore more options for industry measures.  

In another speech at the summit, the Treasury's economic affairs secretary, Harriett Baldwin, indicated that the UK's openness and welcome to fintech innovation comes not only from the announcement of new measures, but also from the choice of targets. She announced a friendly relationship with digital currencies such as Bitcoin and assured attendees that this is just the beginning.  

Mr Baldwin further elaborated that a leading fintech industry group, made up of digital experts selected under the Visa scheme criteria , had for the first time reached an agreement with their Australian counterparts to simplify regulatory procedures in both markets.

More measures to come  

"We will be announcing further additional measures to benefit our customers in the UK," Baldwin said.  

Therefore, we can expect that these measures are truly a gesture of goodwill to financial technology (including digital currencies such as Bitcoin). This is not only a cooperative relationship, but also a "win-win" initiative.  

The UK's regulatory environment has always been popular with fintech companies.  

British Chancellor of the Treasury George Osborn bought a Bitcoin through an ATM in 2014 , marking his strong support for Bitcoin and financial technology, making him the most famous government official in the world for purchasing Bitcoin.  

At that time, the government announced a number of measures, including the merger of regulatory approaches with guarantees and access to payment systems with financial functions.

Vigorously supporting FinTech may be the best decision of this century.  

US calls for change  

U.S. regulators have taken notice and are now calling for changes to the country’s complex and outdated regulatory system to embrace 21st century innovation, including abolishing the IRS’s maddening double taxation and cumbersome Bitcoin licenses.  

The call for better regulation culminated in a petition to the Office of the Comptroller of the Currency ( OCC ) after a Commodity Futures Trading Commission director argued that blockchain technology could have prevented the collapse of Lehman Brothers.  

The OCC is an independent agency that regulates banks and is seen as the best suited to navigate a new and welcoming financial technology environment.

The regulatory environment in the United States is complex, with many regulators, some overlapping functions, and different requirements in different states. It remains to be seen whether U.S. regulators will be able to make the transition quickly, given that the United Kingdom is already ahead of the curve, but there is no doubt that the world is watching the United Kingdom's pioneering measures and their aggressive push into fintech.