By Michael B. Cohen
Vice President of Global Operations
Crypto investors and government officials alike may greet the proposal to regulate cryptocurrencies as a step in the right direction. However, outgoing FCA chairman Charles Randall balked at the plan to provide government oversight to crypto assets.
Randall, who was instrumental in an advisory role to the UK Treasury in the aftermath of the 2008 financial crisis has announced his early retirement from leadership at the FCA, the UK’s main financial regulator. He expressed concern over recent proposals to regulate cryptocurrency and to issue a government-backed crypto coin. Enthusiastic statements by Economic Secretary to the Treasury and City Minister John Glen that the UK should become a ‘crypto hub’ prompted Randall to raise the alarm.
Glen’s enthusiastic, almost euphoric statements seemed to usher in a crypto future for the UK. Glen issued a statement in response to the FCA’s strict anti-money laundering rules and called for rules for stablecoins and Royal Mint-issued NFTs. Glen proposed ‘engagement groups’ comprised of representatives from the crypto industry, regulators and the public and proclaimed, ‘We see an enormous future in crypto.’
Randall urged caution amid widespread crypt enthusiasm and stated that before the government begins regulating crypto, it should carefully consider the wisdom of validating ‘purely speculative crypto tokens.’ He asked, ‘Should people be encouraged to believe these are investments when they have no underlying value?’ Randall also pointed out the devastating fall of bitcoin, which has lost half its value in the last six months and the crash of other cryptocurrencies that are now virtually worthless.
The retiring FCA head also pointed out the expense of crypto regulation, which would cost the government at least £8 million to establish a technical infrastructure and to hire and train people with knowledge and experience in crypto finance and security.
To Regulate or Not to Regulate – What Is the Answer?
There is no doubt that even after the devastating crypto crash in May, bitcoin and other digital assets are here to stay. The adoption of crypto by leading corporations including major credit card companies like Mastercard seems permanent, and would be difficult to reverse.
However, the 50% drop in bitcoin’s price, and the ambiguous underlying value of crypto assets may cause the UK government to hesitate before casting their lot with volatile digital assets. The public trust placed in the government to protect consumers from excessive financial risk is a serious consideration.
It’s unclear whether legislators, crypto industry leaders and regulators such as the FCA will reach a compromise solution, but what is certain is that there is disagreement about the future of crypto regulation.
There are many questions that remain, such as, how should regulators deal with unregulated brokers? The FCA certainly warns the public against financial services operating without proper authorisation in the UK, but what should the FCA do if a customer has lost money to a suspicious broker that has no licence?
Since the broker doesn’t have an FCA licence, the FCA itself doesn’t seem to have much authority over the activities of a fraudulent broker, except insofar as it can warn the public.
That’s where crypto trace experts, such as MyChargeBack, can provide assistance. Our team consults with people who have lost money to suspicious bitcoin transactions. We use cointracking technology to detect patterns on the blockchain that can unlock identities behind anonymous bitcoin wallets.
MyChargeBack Will Investigate Your Crypto Case
If you have lost money to a cryptocurrency scheme, seek assistance right away. Consult with MyChargeBack experts and get started with your case. We have extensive knowledge and working relationships with regulators and more than 450 law enforcement agencies around the world, as well as the solutions that can improve your prospects of getting your cryptocurrency back.