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Self-regulatory group CryptoUK and cryptocurrency exchange Kraken UK have condemned a recent report by a UK parliamentary committee that suggested cryptocurrencies should be regulated in the same way gambling is.
In a May 17 report, the Finance Commission ruled that unbacked cryptocurrencies be regulated as gambling due to concerns over “substantial” consumer risks associated with the asset class, such as price volatility and lack of intrinsic value. It was “strongly recommended”.
Ultimately, he called for cryptocurrencies to be regulated based on the following principles: “Same risks, same regulatory consequences. “
The move has not gone down well among local players, especially given that the UK is believed to be heading towards a forward-thinking cryptocurrency hub.
In a May 17 statement shared with Cointelegraph, CryptoUK said, “Adopting this approach will take into account the nuances of this sector and the real opportunities for inward investment and growth across the UK economy. We haven’t,” he added.
“No other country in the world has taken this approach, and the EU MiCA is a good example of a bespoke customization of regulations within the industry to ensure that the UK does not become a hostile environment for corporate residency. We need to adopt a tailored approach.”
The group also said such an approach could ultimately lead UK consumers to seek out offshore cryptocurrency platforms, which would “completely defeat the purpose of protecting consumers through regulation”. He suggested that he felt
In a statement, Kraken UK emphasized that it “fundamentally” disagrees with the Treasury Department’s “conclusion that crypto assets have no intrinsic value.”
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“It is disappointing that the Commission does not support the UK’s opportunity to become a true global leader in a rapidly developing industry,” the company said, adding:
“The Commission’s proposal that crypto assets should be regulated as gambling products is irrelevant and totally inappropriate for UK consumers.
Not only is this “betraying the purpose and potential of technology,” the report said, gambling protections do not provide the same safeguards as financial services regulation.
CryptoUK noted that capital gains tax could be lost if trading cryptocurrencies is considered gambling.
“Gambling is exempt from capital gains tax. Does the UK government want to exclude tens of millions of pounds of tax revenue from profits from unbacked cryptocurrency trading?” said CryptoUK.
Of course not, but to say that this is the result of a very well-participated consultation with written evidence from the parties involved is incredibly absurd.
— Lawrence (@functi0nZer0) May 17, 2023
The extent to which cryptocurrencies will be regulated “as gambling” is not specifically defined by the Treasury Department, but the report imposes strong regulations and guidelines on consumer protection, anti-money laundering and terrorist financing. recommended that
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