The Financial Conduct Authority of Great Britain (FCA) will not regulate Bitcoin and Ethereum, according to the agency’s latest report “PS19 / 22: Guidance on Cryptoassets.” It follows from the document that the FCA considers Bitcoin and Ethereum as “exchange tokens,” which are “usually decentralized and primarily used as a means of exchange”. Therefore, according to the FCA, digital currencies such as Bitcoin and Ethereum will not fall under its regulatory jurisdiction.
However, it is worth noting that the regulatory body came to the conclusion that security-tokens and utility-tokens are still within its competence and may be subject to regulation, since the former are similar to securities, and the latter may fall under the classification of electronic money. The same approach applies to stablecoins, but FCA made it clear that not all of them fall under the definition of electronic money.
Even though the content of the crypto assets guide presented by the British regulator closely resembles the widely discussed CP19 document released earlier this year, the report nevertheless provides more clarity in the classification of digital assets.
UK’s watchdog believes that “market participants use the Guidance as the first step in understanding how they should treat certain crypto assets, however, definitive judgments can only be made on a case-by-case basis.”
Image courtesy of: Megacryptoworld