Exploring the Impact of the New Parliament Member on the Transformation of the Crypto Landscape in the UK

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UK (Parliament Politics Maganize) – Bim Afolami, the member of parliament for Hitchin and Harpenden, assumed the role of economic secretary to the U.K. Treasury on Monday. In this capacity, he will be responsible for overseeing policies related to central bank digital currency (CBDC) and cryptocurrency. Afolami has taken over the position of Andrew Griffith, the former Financial Secretary to the Treasury of the United Kingdom. 

In comparison to other leading tech nations, the U.K. is notably ahead in its regulatory process. While several bills related to cryptocurrencies are undergoing consideration in the U.S. Congress, the United States lags behind other countries in formalising federal laws for the crypto industry.

Andrew Griffith Is Not a Vocal Supporter of Cryptocurrency

Andrew Griffith has not been a vocal supporter of cryptocurrency. Analysis of his interviews and public statements reveals a tendency to advocate for bringing digital assets under traditional regulatory scrutiny. Several months ago, during a debate organized by the cross-party Crypto and Digital Assets All Parliamentary Group (APPG), Griffith informed parliamentarians that the government had no intentions of appointing a ‘cryptotsar.’ Throughout his tenure, Griffith played a role in advancing the Financial Services and Markets Bill, a legislative measure that expanded regulatory oversight over cryptocurrency.

Andrew Griffith emphasized the significance of Clause 14 within the Financial Services and Markets Bill, noting that it marked the first instance of bringing crypto assets under regulatory purview. He stated, “It will ensure that the Treasury is equipped to respond to developments in the crypto sector more quickly and deliver regulation in an agile, risk-based way.”

Expectations are high that Bim Afolami’s assumption of the role previously held by Griffith will lead to an improved regulatory framework for the cryptocurrency environment. The hope is that these changes will foster an environment in the U.K. conducive to the establishment and growth of cryptocurrency businesses and startups.

What is Bim Afolami’s Take on Crypto?

As of now, Bim Afolami has consistently demonstrated a keen interest in the advancement and evolution of cryptocurrency. In the early months of 2022, Afolami engaged in discussions with key members of Coinbase’s cryptocurrency team to address the status of financial services regulation. He underscored the crucial need for an appropriate regulatory framework in financial services, emphasizing its importance.

Additionally, Afolami took the initiative to express his views in a published blog, urging the government to streamline its regulatory approach. In the blog, he delves into the necessity of categorizing and clarifying the fragmented regulatory framework in the United Kingdom. Afolami advocated for a clear definition of the role of a regulator and proposed a comprehensive list of organizations that align with that description.

Furthermore, Afolami articulated in his writing, stating, “The Financial Services and Markets Bill is just one example, empowering regulators even further in managing one of our economy’s most important sectors.” He emphasized the perspective that regulators ought to be evaluated with a focus on emergent technologies and the innovation-driven results they yield.

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Regulating Cryptocurrency Industry

On Monday, the U.K. government officially affirmed its intentions to regulate the cryptocurrency industry, revealing in a consultation paper its plans to establish formal legislation for crypto activities by 2024. 

This announcement followed the government’s response to a consultation paper released earlier in the year, which provided recommendations for regulating the crypto industry. In the latest paper, the government outlined its aim to subject various cryptoasset activities to the same regulatory standards applied to banks and other financial services firms. The new parliament member reveals:

“I am very pleased to present these final proposals for cryptoasset regulation in the UK on behalf of the Government,” Andrew Griffith, the U.K. financial services minister, said in a statement. “I look forward to our continued work with the sector in making our vision a reality for the UK as a global hub for cryptoasset technology.”

The government’s proposals encompass more stringent regulations for exchanges, custodians responsible for storing crypto on behalf of clients, and companies involved in crypto lending. Additionally, the U.K. is considering stricter regimes pertaining to market abuse, as well as issuance and disclosure of cryptoasset. The outlined timeline in the paper indicates the government’s intention to present legislation for the crypto industry to Parliament by 2024.

Beth Malcolm

Beth Malcolm is Scottish based Journalist at Heriot-Watt University studying French and British Sign Language. She is originally from the north west of England but is living in Edinburgh to complete her studies.