The financial regulator in the UK announced a week ago that it has a plan to start overseeing the digital assets- especially bitcoin. The regulator announced that it would do so in partnership with the government. The UK government pledged its support towards initiative as long as Bitcoin is concerned.
The cryptocurrency has been through a period of extreme volatility. There is no central authority governing Bitcoin and it has been a one of the biggest concern of most crypto-investors that it may be the reason for the digital asset being extremely volatile.
This period of volatility has seen a number of illegal crypto-related crimes rise. Crypto-regulation is the need of the hour. It will mitigate the risks for crypto-investors against the fraudsters and ensure that proper mechanisms are in place to facilitate cryptocurrency transactions. A separate regulatory body for cryptocurrency will also help in compensating the victims of losses in digital assets.
Stakeholders in cryptocurrencies have raised concerns regarding consumer protection. As per the Regulatory body- a well-established system will address the concerns of consumer rights and protection. It will also work to counter the increasing rate of crypto-frauds. The UK government is also hoping to exploit the currency for capital raising through ICOs.