New Consultation Paper On Crypto Issued By UK Financial Regulator

The consultation paper titled ‘’Guidance on Cryptoassets’’ is now published by the UK financial regulator so now we are about to find out more about it in our crypto news below.

The goal of the Financial Conduct Authority’s paper for cryptocurrencies is to bring regulatory clarity on the matter for all market participants. The period for consult is expected to end in April 2019 according to the paper after which a final guidance policy statement will be released.

In the intro of the paper, the FCA notes that the final version hopes to help the market participants to better understand whether ‘’the crypto assets they are about to use belong in the regulatory perimeter.’’

The FCA explained:

 “This will alert market participants to pertinent issues and should help them better understand whether they need to be authorised and what rules or regulations apply to their business.”

In the paper you can also read about the many possible definitions on crypto assets and how the UK laws are applicable to them and more importantly the guidance on the crypto assets and how they should be considered as a ‘’specified Investment’’ under the state’s regulated activities order. The regulator also explains that such assets could be regulated by the Payment Services Regulation or E-money Regulations.

The guidance of the FCA on crypto assets puts cryptocurrencies into three categories: security tokens, utility tokens, and exchange tokens. The exchange tokens are those which are not issued or backed by a central authority. Security tokens are assets that fall under the perimeter of FCA’s regulations. Finally, utility tokens are those that grant access to a certain product.

The FCA is investigating 18 more companies over cryptocurrency use as reported back in December.