Britain’s financial watchdog on Tuesday launched plans for full regulatory rules on cryptocurrency from 2026, amid booming demand for highly volatile bitcoin.
The world’s biggest cryptocurrency has surged in value since Donald Trump won the US presidential election in early November.
However, bitcoin has also experienced huge losses in recent years.
Trump has pledged to make the United States the crypto capital of the world through supportive regulations, pushing bitcoin towards the symbolic record $100,000 mark.
Britain’s Financial Conduct Authority on Tuesday announced a roadmap featuring consultations on crypto regulation ahead of “final rules” by the watchdog in 2026.
The FCA also plans by early next year rules on “stablecoins”, which are backed by a traditional currency, most often the dollar.
Cryptocurrency ownership has grown to 12 percent of adults in the UK, according to data from the regulator published Tuesday.
“Currently, crypto remains largely unregulated in the UK and high-risk,” the FCA said.
“Our research results highlight the need for clear regulation that supports a safe, competitive and sustainable crypto sector in the UK,” said Matthew Long, director of payments and digital assets at the watchdog.
The FCA last year tightened rules over the promotion and selling of cryptocurrency, including measures to ensure companies promoting these digital assets give “clear warning” that customers could lose money in “high risk” investments.
‘Inadequate’ FCA
News of the FCA roadmap came as a cross-party parliamentary group on Tuesday slammed the watchdog for its activity over the past three years, claiming it is “not fit for purpose”.
MPs and peers in a report urged an overhaul after concluding the regulator “is seen as incompetent at best, dishonest at worst”.
They added: “Its actions are slow and inadequate, its leaders opaque and unaccountable.”
It follows a series of recent scandals that have marred the financial sector in Britain.
“We sympathise with those who have lost out as a result of wrongdoing in financial services,” the FCA said in response.
“However, we strongly reject the characterisation of the organisation,” it added in a statement.