The UK government are taking a serious look at cryptocurrencies
The cryptocurrency craze has seen many local authorities take action, from regulation to investigation, ensuring that its citizens are in a safe position when it comes to speculating with their money. And now the UK government are entering that conversation with their own investigation into crypto exchanges in England and Wales.
“People are becoming increasingly aware of cryptocurrencies such as Bitcoin, but they may not be aware that they are currently unregulated in the UK, and that there is no protection for individual investors,” explained Treasury Committee chair Nicky Morgan to the BBC. The technologies behind cryptocurrencies, like Blockchain, have been praised, which is something the inquiry will investigate – how can Blockchain technology be harnessed while maintaining a creative, thriving climate for developers to work uninhibited?
The project aims to examine how virtual currencies – like the infamous bitcoin – affect British businesses and investors, looking at the “potential risks that digital currencies could generate for consumers, businesses, and governments, including those relating to volatility, money laundering, and cyber-crime. We will also examine the potential benefits of cryptocurrencies and the technology underpinning them, how they can create innovative opportunities, and to what extent they could disrupt the economy and replace traditional means of payment.”
And while this might be reported as a negative thing by the media – of whom many are quick to strike a negative note when talking of governmental influences on crypto – the move might have a positive influence on the market. With MPs keen to strike a balance between regulation and protection, we could see confidence levels rise in investments given the extra security that regulation affords. This could in turn lead to a less volatile market – good news for the long-term investor but less lucrative for the short-term dip investor, looking to capitalise on the up-and-down nature of tokens like Bitcoin.