Cryptoassets Taskforce to evaluate need for cryptocurrency regulation

The Cryptoassets Taskforce was set up in March and includes representatives from the UK Treasury, the Bank of England and the Financial Conduct Authority (FCA). It met for the first time on Monday, where it agreed on its objectives.

According to a statement issued by the government, the taskforce will explore "the impact of cryptoassets, the potential benefits and challenges of the application of distributed ledger technology in financial services" and also assess "what, if any, regulation is required in response".

As part of its work, the taskforce will consider "existing analysis by the government and regulators" and it will also seek new views of "trade bodies, academics, consumer groups and investor representatives", the statement said.

Andrew Bailey, FCA chief executive, said: "Cryptoassets have been an area of increasing interest for markets and regulators globally including the FCA. We look forward to working with our counterparts at the Bank of England and the Treasury as part of the taskforce to develop thinking and policy on cryptoassets."

Dave Ramsden, deputy governor of the Bank of England, said: "The technologies that underpin cryptoassets have the potential to deliver benefits both to the financial system and to the economy it serves. This taskforce will enable us to work closely with the Treasury and the FCA to explore how the opportunities posed by these technologies can be realised, while also tackling the risks arising from cryptoassets."

The taskforce is scheduled to host a roundtable event in July and publish a report on its findings sometime before then and the end of September.

Pinsent Masons, the law firm behind Out-Law.com, recently hosted a workshop on cryptocurrency, distributed ledger technology and their regulation at its recent Future of Money conference. The overall view expressed by members of banks and other businesses from the payments market that attended was that while it is inevitable that cryptocurrency markets will become more tightly regulated in future, regulation must not thwart innovation and growth nor be too loosely worded and applied.