The United Kingdom is preparing a regulation for the use of stablecoins. According to a government statement, the nation aims to become a technology hub for the crypto market.
Chancellor of the Exchequer Rishi Sunak says that stablecoins must be integrated into the UK’s payment system. As such, this type of cryptoasset can be classified as a means of payment by England.
In addition, Rishi Sunak said that the UK could attract companies operating in the crypto market that are looking to “invest, innovate and grow in this country”. The executive’s statement was presented during the Global Finance Summit, recently in London.
The UK to provide more security for stablecoins
The plan to regulate stablecoins aims to provide more security for users using the cryptoasset. According to the legislative proposal, the UK is expected to develop legislation that can serve as an example for other countries.
Regarding tax collection in the crypto market, Rishi Sunak advises that it will not take a significant tax reform in England to integrate cryptoassets.
The National Treasury should also propose regulatory initiatives regarding tools widely used in the crypto market, such as decentralized finance lending protocols (DeFi) and staking programs for digital assets.
While the regulation has introduced measures to oversee and control digital currencies, the UK is looking to change the rule on tax incentives for asset managers who hold crypto assets in their portfolios.
This is not the first time the UK has published regulatory measures on stablecoins. As recently as 2019, the UK’s Financial Conduct Authority established through “Guidance on cryptoassets”, that crypto market companies would be subject to current tax legislation.
The measure was valid for platforms that offer international payments with cryptoassets. However, until then, the rule did not apply to digital currencies, only to companies in the industry.