The crypto crackdown continues as law officials realize the unregulated nature of the decentralized marketplace. The U.K. Treasury Committee is now trying to take back the reigns on what they are now referring to as the “Wild West.”
In a report released Wednesday, committee members detail the many ways in which cryptocurrency exchanges are risky for investors, especially uninformed ones. The unregulated industry is unstable ground for these crypto newbies according to Nicky Morgan MP, chair of the Treasury Committee. When commenting on the report Morgan said:
“Bitcoin and other crypto-assets exist in the Wild West industry of crypto-assets. This unregulated industry leaves investors facing numerous risks.
Given the high price volatility, the hacking vulnerability of exchanges and the potential role in money laundering, the Treasury Committee strongly believes that regulation should be introduced.
It’s unsustainable for the Government and regulators to bumble along issuing feeble warnings to potential investors, yet refrain from acting.
At a minimum, regulation should address consumer protection and anti-money laundering. If the Government decides that crypto-asset growth should be encouraged, appropriate and proportionate regulation could see the UK become a global centre for this activity.”
Instead of banning the digital currency, Britain aims to regulate the crypto industry instead. Officials view this was a way to protect their citizens from market volatility. The report outlines issues related to security vulnerabilities, price swings, and how cryptocurrency can be used for nefarious purposes. They will no longer be standing back acrnd allowing for the crypto markets to be used for criminal activity nor will they watch vulnerable investors fall victim to price manipulation.
The government also believes that regulation would bring much-needed stability to digital asset value. Britain dreams of setting the standard for government reform in crypto and becoming a global crypto trading center.
The report goes on to further critique the current development of blockchain technology. The committee feels that while distributed ledger technology does have great potential to manage data, it is a slow and ineffective medium for transacting funds. They are also concerned about how energy intensive the mining process is.
While some might not enjoy the arguably hyperbolic attitude surrounding the report that includes such sensationalized phrasing like calling crypto markets the “Wild West,” the committee makes observations worth noting and seriously seeks to reconcile the world of decentralization with that of centralized government.