Time to regulate bitcoin, says Treasury committee report

Time to regulate bitcoin, says Treasury committee report

Time to regulate bitcoin, says Treasury committee report

 

MPs in UK say ‘wild west’ cryptocurrency industry is leaving investors vulnerable

 

Bitcoin and other cryptocurrencies are “wild west” assets that expose investors to a litany of risks and are in urgent need of regulation, MPs on the Treasury select committee have said.

 

The committee said in a report that consumers were left unprotected from an unregulated industry that aided money laundering, while the government and regulators “bumble along” and fail to take action.

 

The Conservative MP Nicky Morgan, the chair of the committee, said the current situation was unsustainable.

 

“Bitcoin and other crypto-assets exist in the wild west industry of crypto-assets. This unregulated industry leaves investors facing numerous risks,” Morgan said. “Given the high price volatility, the hacking vulnerability of exchanges and the potential role in money laundering, the Treasury committee strongly believes that regulation should be introduced.”

 

Crypto-assets are not covered by the City regulator, the Financial Conduct Authority (FCA), and there are no formal mechanisms for consumer redress or investor compensation.

 

The committee argues in the report that at a minimum, regulation should be introduced to add consumer protection and counter money laundering.

 

It said that as things stood, the price of crypto-assets was so volatile that while potential gains were large, so too were potential losses. “Accordingly, investors should be prepared to lose all their money,” the committee said.

 

The FCA said: “The FCA agrees with the committee’s conclusion that bitcoin and similar crypto-assets are ill-suited to retail investors, and as we have warned in the past, investors in this type of crypto-asset should be prepared to lose all their money.”

 

A Treasury spokesman said: “We set up the joint Cryptoassets Taskforce earlier this year because we want to better understand the potential risks and benefits of crypto-assets to people, businesses, and the economy.”

 

In 2017, the price of a bitcoin soared by more than 900%, hitting a peak of almost $20,000 in December. Its popularity has since waned, with one bitcoin now priced at around $6,270.

 

 

Bitcoin: is it a bubble waiting to burst or a good investment?

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The digital currency emerged after the financial crisis. It allows people to bypass banks and usual payment processes to pay for goods and services.

 

Last year Jamie Dimon, the chief executive of JP Morgan, said bitcoin was a fraud and only fit for use by drug dealers, murderers and people living in places such as North Korea. He said: “The currency isn’t going to work. You can’t have a business where people can invent a currency out of thin air and think that people who are buying it are really smart.”

 

Originally printed in the Guardian.

David

Cryptocurrency latest – Unprecedented Bitcoin legal battles BAFFLE top regulation lawyers

Cryptocurrency latest - Unprecedented Bitcoin legal battles BAFFLE top regulation lawyers

Cryptocurrency latest – Unprecedented Bitcoin legal battles BAFFLE top regulation lawyers

UNPRECEDENTED legal battles are set to take place in the UK after it was reported that divorce lawyers are struggling to come up with settlement agreements over cryptocurrencies.

The unusual legal cases are said to concern at least three couples looking to legally separate.

One pair has a fortune of £600,000 in cryptocurrencies that they are currently struggling to agree how to split.

The lack of regulation surrounding the digital currencies means that there is little legal cover for those looking to protect their online assets in the case of a divorce.

Bitcoin, Litecoin, Ripple and Ethereum are all understood to be at the centre of online money involved in the divorce cases.

Vandana Chitroda, a partner at the law firm Royds Withy King, said: “These are the first cases we have seen, and we expect to see many more.

“We believe that cryptocurrencies will be a significant feature in a large number of divorces.

“Whilst cryptocurrencies are volatile, they are not going to go away.”

Bitcoin has dramatically seen its value plunge throughout 2018 from a record high of nearly £15,000 in December 2017 to now under £7,000.

However, there is evidence to suggest the number of people investing in cryptocurrencies is rising.

Ms Chitroda added: “It is important that if you believe your husband or wife has invested in or purchased cryptocurrencies, such as Bitcoin, and you are separating, you tell your legal adviser.”

Countries around the world are currently looking at implementing regulation for digital currencies in an effort to catch up with the latest financial craze.

The finance minister and Central Bank Governors of France and Germany have requested that talks on policy and monetary implications of cryptocurrencies be part of G20 talks in March.

They want world leaders to come up with a global strategy for the online assets.

Some countries have already begun to act unilaterally to increase regulation.

South Korea introduced a raft of measures last month aimed at regulating Bitcoin and similar currencies such as Ripple and Ethereum.

A ban on anonymous trading was implemented by the Asian power in a bid to crack down on all possible criminal activities the secret nature of trading Bitcoin allowed.

Meanwhile, India’s Government has said it does not consider cryptocurrencies to be legal tender and will try to phase out payments using the online money.

 

 

 

Author DAN FALVEY UPDATED: 05:29, Thu, Feb 15, 2018

 

Posted by David Ogden Entrepreneur
David Ogden Cryptocurrency Entrepreneur

David