UK Launches Inquiry Into Cryptocurrencies

Blockchain, Cryptocurrencies, Law and Regulation, News

MPs in the UK have launched an inquiry into cryptocurrencies as Bitcoin and other Altcoins are gaining more widespread attention.

Last year saw Bitcoin surge and then rapidly fall in value, and this fluctuation has drawn a great deal of attention to cryptocurrencies. Some see the innovation as a waste of time, a scam even, others remain undeterred and continue to trust the technology. Despite this split in opinion, more people are using the technology every day, and, as a result, the Treasury has launched an inquiry to determine whether the government is doing enough to protect investors.

Finance ministers in both France and Germany have already asked that crypto is placed on the agenda of the upcoming G20 meeting, so this could have a significant impact on the technology’s future. We could be about to witness the beginning of a drive to control crypto (how successfully this can be done remains to be seen) or a move that sees regulators facilitate innovation while doing more to protect the interests of investors and vulnerable individuals.

Regulation might not be a bad thing

Blockchain technology is still in its infancy, and it’s fair to say that authorities have been slow to react to the challenges it presents. This isn’t necessarily bad for innovation, the crypto community has exploded almost unchecked since 2008 when Satoshi Nakamoto published the Bitcoin white paper, but on the downside, there are currently few regulations in place to protect individuals from scammers and other threats. Facebook and other platforms have banned advertising by ICOs, but there seems to be a dire need for government intervention so that citizens can be protected from criminals.

Governor of the BoE slams Bitcoin

The Independent reported that Mark Carney (Governor of the Bank of England) said that Bitcoin ‘has failed as a currency measured by standard benchmarks – it is neither a store of value, nor a useful way to buy things.’

This is an important quote considering that the BoE has been looking into issuing their own cryptocurrency and that Bitcoin has done a pretty good job of establishing confidence with people worldwide, as daily more people and businesses recognize it as a valid form of payment. One might also argue that Bitcoin, being radically different from fiat currency, cannot be accurately measured by any standard benchmarks.

Image Courtesy Wikimedia Commons

One thing that the BoE has made clear in looking to issue their own crypto is that although crypto does have its detractors, they recognize its broader potential. But the BoE is not alone in this, banks and governments worldwide are taking a more significant interest in blockchain technology and the uses to which it can be put.

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Michael is an English and Creative writing graduate of Liverpool John Moore’s University, a former editor of several magazines, and a crypto-currency enthusiast. He is mostly interested in crypto-legislation and the potential of decentralized technology to change the world.

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