To better understand cryptocurrencies and the impact of blockchain technology across financial institutions, the UK Treasury Committee has set forward a research inquiry.
“People are becoming increasingly aware of cryptocurrencies such as Bitcoin, but they may not be aware that they are currently unregulated in the UK, and that there is no protection for individual investors,” Member of Parliament and Chair of the Treasury Committee Nicky Morgan said in a statement.
The inquiry looks to tackle a number of topics in regards to how the digital asset class could affect consumers, businesses, and the government, as it will not just “examine the potential impact,” but also “scrutinise the regulatory response to digital currencies” from government entities such as the Financial Conduct Authority (FCA), the Bank of England, and the government itself.
“The Treasury Committee will look at the potential risks that digital currencies could generate for consumers, businesses, and Governments, including those relating to volatility, money laundering, and cyber-crime,” said Morgan. “We will also examine the potential benefits of cryptocurrencies and the technology underpinning them, how they can create innovative opportunities, and to what extent they could disrupt the economy and replace traditional means of payment.”
According to the inquiry, the Treasury will also cover how the government, FCA, and the Bank of England respond to anti-money laundering laws and how regulation could help protect the investors without damaging innovation within blockchain technology.
Questions the committee will consider include tackling the risks and benefits, the extent cryptocurrencies could disrupt the economy and the public sector, what the government has to understand and prepare for the adoption of such currencies, and what the UK can learn from other governments and regulators handling cryptocurrencies.
Anyone willing to address the inquiry can send a written submission via the inquiry page on the Parliament website.
“This inquiry comes at the right time, as regulators and Governments wrestle with recent events in cryptocurrency markets. New technology offers the economy potential gains, but as recently demonstrated, it may also bring substantial risks,” Alison McGovern MP, member of the Treasury Committee, said in a statement. “It is time that Whitehall and Westminster understood cryptocurrency better, and thought more clearly about the policy environment for blockchain technology.”