Rip­ple calls for UK to end ‘Wild West’ days of cryp­tocur­ren­cies

The Daily Telegraph - Business - - Business - By Tom Rees

RIP­PLE, the world’s third largest dig­i­tal cur­rency, has urged Bri­tish reg­u­la­tors to fol­low in the foot­steps of Ja­pan and im­ple­ment new rules to end the “Wild West” days of the cryp­tocur­rency mar­ket.

Ryan Zagone, head of reg­u­la­tory re­la­tions at the trans­ac­tions in­no­va­tor and dig­i­tal cur­rency, called on UK reg­u­la­tors to strike a bal­ance be­tween “cap­tur­ing risk and en­abling in­no­va­tion”. He high­lighted three “pil­lars” for law­mak­ers to tar­get in reg­u­la­tion: con­sumer pro­tec­tion, anti-money laun­der­ing and fi­nan­cial sta­bil­ity.

“We’re at that time now where we need more clar­ity and rules and we need more cer­tainty. It’s a good time to start re­vis­it­ing that ‘wait and see’ ap­proach taken by reg­u­la­tors,” said Mr Zagone, com­par­ing the reg­u­la­tory en­vi­ron­ment on cryp­tocur­ren­cies to the early days of the in­ter­net.

Ja­pan over­hauled its rules on Bit- coin last year, in­tro­duc­ing leg­is­la­tion to pro­tect con­sumers and forc­ing cryp­tocur­rency ex­changes to com­ply with anti-money laun­der­ing reg­u­la­tion. But re­vamp­ing rules to in­clude new crypto-as­sets has been slower mov­ing in the UK.

Mr Zagone said that Ja­pan had been a “leader” and could be used as a blueprint for other na­tions in­clud­ing Britain. Chan­cel­lor Philip Ham­mond un­veiled a new task­force last month to help safe­guard con­sumers and in­cluded rep­re­sen­ta­tives from the Trea­sury, the Bank of Eng­land and fi­nan­cial watch­dog the FCA.

He said the task­force would help the UK “man­age the risks around crypto-- as­sets”. Bank of Eng­land Gov­er­nor Mark Car­ney warned that Bit­coin and other cryp­tocur­ren­cies face a reg­u­la­tory clam­p­down, say­ing that they had all the “hall­marks of a bub­ble”.

The cryp­tocur­rency mar­ket was rocked ear­lier this year by au­thor­i­ties across the globe sig­nalling that they would crack down on the sec­tor as the Bit­coin craze gripped mar­kets. But Mr Zagone ar­gued that reg­u­la­tion is needed to help the mar­ket ma­ture and draw in new en­trants.

“Reg­u­la­tion cre­ates the guardrails on the high­way that al­lows new en­trants to come in, par­tic­u­larly in­sti­tu­tional in­vestors,” he said.

Re­tail in­vestors are thought to have had their fin­gers burnt by the in­cred­i­ble rise and fall of cryp­tocur­ren­cies. Bit­coin’s price had sky­rock­eted to a peak of more than $19,500 (£13,700) in De­cem­ber be­fore tumbling back to $6,600 this month.

An­a­lysts at Bar­clays re­cently com­pared Bit­coin to “an in­fec­tious dis­ease”.

‘Reg­u­la­tion cre­ates the guardrails on the high­way that al­lows new en­trants to come in’

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