Former chancellor of the exchequer Philip Hammond is warning that unless the UK makes some big moves in the very near future, it could be too late to make good on its aim to be a significant world crypto hub going into the future.
Opinion on crypto in the higher echelons of government, banks, and regulatory bodies in the UK are extremely polarised, and this is making it very difficult for the country to move ahead and become a friendly harbour for cryptocurrencies.
While Rishi Sunak, the current chancellor of the exchequer, has announced plans to make the UK a global hub for crypto-assets, Andrew Bailey, governor of the Bank of England, is convinced that cryptocurrencies have no intrinsic value.
Add to this the fact that the leading regulatory body in the UK, the Financial Conduct Authority (FCA), has published warnings to investors that it offers them no financial protection and that they could lose all their money, then you realise that the UK’s top financial bodies are certainly not on the same hymn sheet with Sunak’s proposal.
Philip Hammond, who is now a senior advisor to Copper.co, a London-based crypto custodian and training services provider, said in a Bloomberg interview published earlier today, that in the past the UK had been very agile in embracing new technology, and that it had used its regulators intelligently in order to get ahead of its competitors.
In Hammond’s view, in the case of digital trading, he felt that the UK was not taking advantage. He said:
“Particularly in the area of digital asset trading, I feel that the UK has missed a trick. It isn’t too late for us to catch up and recover that ground, but I was saying that six/nine months ago, and we are getting very close to the point where it will be too late.”
The ex-chancellor lamented that most other jurisdictions were “racing ahead of us” and even the European Union, with its regulations on digital assets markets, will be in front of the UK, and he said that the EU had not been ahead of the UK on the regulation of emerging technologies in a very long time.
He said that the problem with crypto is the lack of regulation, and that this was giving the sector a bad name.
“The problem is that there are no regulations, and nobody quite knows where they stand. It’s a bit of a Wild West, and has gained frankly a mixed reputation, particularly among policy makers and politicians, and the public.”
Hammond said that at the moment it was all about bitcoin, but in 3 years or so it would be about tokenised equities and bonds that would be traded very efficiently and securely. He added that the jurisdictions that got this right would be those that ended up being the new hubs for digital asset trading.
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