Concerns Raised Over Retail Trading of Digital Assets
The UK Treasury Committee has published a report urging the government to regulate cryptocurrencies as gambling instruments rather than financial assets.
According to the committee, retail trading of digital assets resembles sports betting more than investments. Even major cryptocurrencies like Bitcoin and Ethereum are deemed to have “no intrinsic value and serve no useful social purpose.“
In February, the Treasury Committee issued recommendations for stringent regulation, highlighting the volatility of cryptocurrencies as a significant risk for retail investors. However, officials acknowledge the economic benefits of blockchain technology.
CryptoUK, a trade association representing the crypto industry, strongly disagrees with the Treasury’s characterization.
In February, the UK Treasury released a document outlining plans to supervise cryptocurrency exchanges and lending platforms to ensure compliance with “fair and robust standards.”
Earlier, John Cunliffe, Deputy Governor of the Bank of England, proposed regulating digital assets similarly to traditional finance. He also pointed out that decentralized protocols currently lack an effective means of managing risks.