Regulation of digital assets is now in the center of attention. Indeed, the Americans are not the only ones who want to create a strict and clear framework to govern this market. Even the United Kingdom is coming to replenish the ranks. Through the DCMS (Department for Digital, Culture, Media and Sport), it aims to investigate the future and credibility of the NFT market.
British regulations are limited to the fight against money laundering
So far, yes digital asset market regulation in the UK it is limited to anti-money laundering compliance. It requires every crypto company to register with the FCA (Financial Conduct Authority) before obtaining a license. Last week, the House of Commons also passed a financial markets and services bill.
As for the NFT, the elected officials speak of a total lack of regulation. Therefore, this survey will help parliamentarians to better understand NFTs and draft an appropriate upstream bill.
A study to know the benefits and risks of NFTs
According to statement of the UK House of Commons, the investigation will be carried out by the DCMS. This commission will undoubtedly consist of several deputies. Its main mission: to study the functioning of the NFT market. With this in mind, he will need to determine the advantages of immutable tokens as well as the potential risks they pose in the short, medium and long term.
“MPs will need to consider whether NFT investors, particularly vulnerable speculators, are being put at risk by the market,” he said. A very commendable step as the price and sale of NFTs are currently experiencing a downward trend. A 90% drop from August 2021 to March 2022, according to the latest data.
A regulation that will strengthen the coordination of NFTs in the UK
The results of DCMS investigation it will certainly lead to proposals to regulate the NFT market. A new regulation that will fill the legal gap regarding NFTs. But a law which will also have the mission of strengthening the coordination of NFTs in the United Kingdom.
Since the new Prime Minister Rishi Sunak took office, many truly believe that NFTs and other digital assets can have a place in the UK. While still Chancellor, the new British Prime Minister expressed his support for the creation of a Bank of England digital currency. He was also in favor of creating a Royal Mint NFT.
The British parliamentary committee’s investigation is not exclusively about the NFT market. It also encompasses the broader blockchain ecosystem. Some fear the results of such a study, while others see this approach as an opportunity to better understand NFTs and digital assets. With a strict regulatory framework, they can really be made more accessible to as many people as possible. Towards a democratization of digital assets, we would say!
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My name is Ariela and I am 31 years old. I have been working in the field of online writing for 7 years. I only discovered trading and cryptocurrency a few years ago. But it’s a universe I’m very interested in. And the topics covered within the platform allow me to learn more. A singer in her spare time, she also cultivates a great passion for music and reading (and animals!