Stable cryptocurrencies will be regulated by the UK Treasury

The UK Treasury is on track to legalize stack coins

During the Queen’s speech, Prince Charles announced the introduction of a bill that would help tackle illegal funding, reduce economic crime and help businesses grow. The UK Treasury, or Her Majesty’s Treasury, has reportedly decided to go ahead with the regulation of stack coins. Although welcomed by the crypto community, the decision comes as a shock due to its proximity to the recent fall in stablecoin popular algorithm, TerraUSD (UST).

A report made by The Telegraph highlighted the Treasury’s intention to regulate stack coins throughout the UK, which was revealed during the Queen’s speech. During his speech, Prince Charles announced the introduction of new legislation in various sectors, including measures to stimulate economic growth to improve living standards in the region, adding: “A draft law will be introduced to further strengthen the powers to combat illegal financing, reduce financial crime and help businesses grow [Projet de loi sur la criminalité économique et la transparence des entreprises]. “

The Cointelegraph’s report of 4 April drew the attention of the United Kingdom’s Ministry of Economy and Finance, which cited changes to its existing regulatory framework to incorporate stablecoins as a means of payment.

While the recent collapse of the Terra ecosystem – which led to an irreversible decline in cryptocurrencies LUNA and UST – was to raise red flags among regulators, the British Treasury maintains its course “to ensure that the UK financial sector is always at the forefront of technology and innovation”, as previously reported by Chancellor Rishi Sunak.

However, the Treasury plan does not involve the legalization of algorithmic stack coins and instead prefers fully supported 1: 1 cryptocurrencies such as Tether (USDT) or USD Coin (USDC). According to the Treasury Department spokesman: “Legislation regulating stack coins when used as a means of payment will form part of the Financial Services and Markets Bill, which was announced in the Queen’s speech.”

By legalizing stack coins for the UK market, the Treasury aims to open up opportunities for growth while ensuring financial stability by introducing new financial technologies. The spokesman highlighted the fact that the value of Terra’s UST token was linked to another cryptocurrency, saying: “The government has made it clear that certain stack coins are not suitable for payment purposes as they share characteristics with unsupported cryptocurrencies. “

U.S. Securities and Exchange Commission (SEC) commissioner Hester Peirce recently stressed the need for a “space where there can be failure,” while supporting a regulatory framework for stable cryptocurrencies.

dry stable cryptocurrencies

While speaking in an online panel, Peirce mentioned the growing interest in stack coins among regulators. As the Cointelegraph reported, Peirce urged the SEC to grant exemptions for certain technologies, which would allow for the necessary experiments: “We need to make room for failure, because it is, of course, part of trying new “and our framework really allows for that kind of trial and error. I hope we will use it for that purpose.”

By Arijit Sarkar, Cointelegraph

Arijit Sarkar is the editor of Cointelegraph. With a master’s degree in journalism and mass communication, he pursues his dream of making a positive difference in the media industry. He also enjoys cycling and writing poems.

The opinions expressed here are solely those of the author and do not necessarily reflect the views of Forex Quebec. Every investment and trading move involves risk, you should do your own research when making a decision.

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