While the United States is pushing crypto companies away with its harsh and unclear approach to crypto regulation, the UK’s financial conduct authority (FCA) is working with crypto firms to come up with regulation for the industry.
The UK has severally demonstrated its commitment to becoming a crypto hub. It is showing that commitment once again by calling on crypto firms all over the world to work on regulation that will benefit both the industry and the government.
In a speech at the City Week conference in London on Tuesday, April 26, the FCA Executive Director of the FCA, Sarah Pritchard suggested that the agency was interested in dialogue with crypto firms to agree on a regulatorry framework rather than a harsh enforcement approach like is the case in the U.S.
"Let’s work together to shape our rules and regulations to benefit markets, consumers, and firms as crypto goes from niche to mainstream," Pritchard said. "Let us do it with our minds open to the potential gains and our eyes open to the risks," she added. The FCA is the regulatory body in charge of financial conduct in the UK. That makes it the agency with the final say on crypto, and also the body with the responsibility of regulating cryptocurrencies. With its unique approach, the agency is trying to establish firm but friendly regulation in the UK that will allow crypto startups to thrive in line with the vision of its prime minister, Rishi Sunak. UK's Crypto-Friendly Disposition The UK has been tough in terms of crypto regulation, but its approach has been friendly generally. The prime minister had proposed that the government mints its own NFT collection when he was finance minister. Although the plan has been halted for now, Sunak still wants to make the UK a destination for crypto projects to grow and thrive. It may be in line with this vision that the FCA is looking for collaboration with crypto firms on how to come up with proper regulation for the industry. This is completely the opposite of what happens in the US, where regulators seem to be out to get crypto companies. It is no wonder that crypto giants like Coinbase are considering leaving for friendlier climes like the UK. The exchange has already sued the SEC with support from thousands of other crypto companies, seeking regulatory clarity for the industry. If this is not done, there may be more exodus of crypto startups from the US. UK Friendliness Could Hurt the US If the approach in the US does not change, countries like the UK that are working with crypto companies on regulatio ns are likely to attract companies that are based in the US. This will affect the country in terms of revenue they can generate from the industry, but the government will have itself to blame if it doesn't call the SEC to order.