U.K. Seeks to Regulate Stablecoins and Become Global Crypto Hub, Plans for An NFT

The U.K. government is set to initiate some key measures in integrating cryptocurrencies to its financial ecosystem. On Monday, April 4, U.K. Finance Minister Rishi Sunak said that the U.K. government is planning to mint its own non-fungible token (NFT) by this summer as a push towards becoming the “world leader” in the crypto space.

Sunak further added that Royal Mint, the agency responsible for minting coins in the U.K. will create and issue an NFT by this summer. Furthermore, the government is planning to bring stablecoins under its regulatory framework and will legalize its use as a recognised form of payment.

Additionally, the government will also introduce a ‘financial market infrastructure sandbox’ that will help firms to innovate and experiment in the crypto space. Speaking about their plans, Chancellor of the Exchequer, Rishi Sunak said:

“It’s my ambition to make the UK a global hub for cryptoasset technology, and the measures we’ve outlined today will help to ensure firms can invest, innovate and scale up in this country. We want to see the businesses of tomorrow – and the jobs they create - here in the UK, and by regulating effectively we can give them the confidence they need to think and invest long-term”.

Economic Secretary to the Treasury, John Glen spoke at the Innovate Finance Global Summit yesterday. Glen said U.K. will proactively approach potential transformative benefits of distributed ledger technology (DLT) in the country’s financial market.

This will encourage data sharing in a decentralized manner while achieving greater transparency, efficiency, and resilience. The government will also explore the feasibility off using DLT in sovereign debt instruments.

Interestingly, the U.K. government is also willing to address other sectors of the crypto market. The U.K. Law Commission will work to facilitate the legal status of blockchain-based communities known as decentralized autonomous organizations, or DAOs.

Furthermore, the government will also workout a tax structure for DeFi loans and staking process. The government will establish a Cryptoasset Engagement Group that will be chaired by ministers and members of crypto business and the U.K. regulators.

“We shouldn’t be thinking of regulation as a static, rigid thing,” Glen said. “Instead, we should be thinking in terms of regulatory ‘code’ — like computer code — which we refine and rewrite when we need to.”

Apart from that Glen said that the government is widening its outlook towards newly emerging markets of the Web 3.0. “No one knows for sure yet how Web3 is going to look,” Glen said. “But there’s every chance that blockchain is going to be integral to its development. We want this country to be there leading from the front, seeking out the greatest economic opportunities.”