UK gets serious with regulatory focus as it recruits head of new crypto department



The UK financial regulator, the Financial Conduct Authority (FCA), has set its sights on cryptocurrencies in a week filled with crypto regulation news. The FCA is actively recruiting someone to guide them in building a team focused entirely on digital assets.

A bullish sign for cryptocurrencies

While many will reject the idea of ​​cryptocurrency regulation, this is very bullish for cryptocurrencies as a whole. Following news from both the US and the EU that digital assets are being integrated into the global financial system, it illustrates that the FCA is warming up towards cryptocurrencies. We seem to be past the days of worrying that governments around the world are going to ban cryptocurrencies altogether.

The objective of the new role of Head of Department is,

to build and run a new crypto department to direct and coordinate the FCA’s regulatory activity in this emerging market.

The content of the job offers reveals that they are not looking to hire someone to justify the crackdown on cryptocurrencies. Instead, they focus on building a “supervisory framework to manage complex, novel and precedent-setting cases”. This statement is unequivocally accurate. Crypto and blockchain technology as a whole is highly complex, with a wide range of different consensus mechanisms, asset classes, and structures. Current regulation is critical and almost completely out of date as we rely on fiduciary regulatory policy conversions. The UK government admits that most cryptocurrencies are outside the regulatory perimeter. With “around 2.3 million people in the UK they are now believed to own a crypto asset,” It is about time the FCA set up a proper department to give crypto the credit it deserves.

What does this mean?

The list also reveals that the FCA is focusing on “oversee innovative and complex business models of registered companies and deal with unregistered crypto-asset businesses that may be involved in scams and fraud.” Interestingly, fiat currency is also no stranger to scams and fraud. In fact, in 2020, in the UK alone, £1.26 billion was lost to fraud through payment cards, checks, remote banking, and authorized auto-pay scams. Furthermore, for an industry repeatedly criticized for its role in fraud cases, the total loss to crypto scams in the same year was around ten times less than fiat scams.

Protecting investors is the main focus of the FCA, it is not surprising that they are looking to create proper policies around cryptocurrencies. However, it does open the question of how the FCA will handle crypto services registered outside of the UK after this appointment. Will businesses be required to register in the UK in order to trade cryptocurrencies to UK citizens legally? Popular stock trading companies, such as WeBull, are not available to UK traders due to the complexity of UK regulations. Could we see Coinbase, Binance and others pull out of the UK in the near future? Binance Markets Limited, the UK arm of the company, has already had problems with the FCA, and have not yet started trading. the Binance United Kingdom The website still shows only a message requested by the FCA that says:

Binance Markets Limited is not permitted to conduct any regulated business in the UK.

job requirements

A careful look at the entire job listing does not ultimately inspire confidence. There are three levels of requirements; minimum, essential and desirable. The FCA only lists having some knowledge of crypto at the lowest level. The position, therefore, may ultimately be filled by someone with little or no experience in the crypto industry. Hopefully we don’t have someone who doesn’t know the difference between proof-of-work and proof-of-stake consensus mechanisms.

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