The Bank of England has begun drafting the country’s cryptocurrency regulatory framework. The organisation appears ready to establish some ground rules, despite the fact that the sector is now small but growing rapidly. The Bank of England has also started a survey to learn about local banks’ current bitcoin exposures and future intentions, with a June 3rd deadline for submissions.
Cryptocurrencies appear to have been raised as a potential means of bypassing sanctions as a result of the conflict between Russia and Ukraine, and authorities have surely pushed crypto higher up their priority list. The BoE, on the other hand, appears to recognise that this particular anxiety is unfounded.
Until the specified regulatory framework is implemented, the Bank of England will focus on ensuring that risks associated with cryptocurrencies are under control. Stablecoins are expected to be backed by high-quality and liquid assets, including loss-absorbing capital similar to that maintained by banks, according to the Bank of England.
“In 2023, the BoE and the FCA will continue to work on stablecoin rules and consult on a regulatory architecture for systemic stablecoins,” the institution’s Financial Policy Committee (FPC) announced. The above looks to be a continuation of remarks made by the bank’s governor earlier this month.