UK lawmakers drop crypto-is-gambling idea and welcome a16z’s riches

One day after UK Prime Minister Rishi Sunak trumpeted a16z’s decision to open an investment office in London, British lawmakers committed to providing the embattled crypto industry with a welcome place to do business.

In a forum at Westminster Hall, Lisa Cameron, a member of Parliament and chair of the all-parliamentary party group on crypto, vowed to move forward quickly on clarifying the rules of the road for the digital assets community.

‘Regulatory pathway’

“With a regulatory pathway over the next 12-18 months, we could harness a leadership position in this sector,” Cameron said, echoing remarks she made to DL News in an interview earlier this month.

Andrew Griffith, the Economic Secretary to the Treasury, reinforced Cameron’s message. “The UK must show early leadership within this internationally competitive sector, which is why we are working flat out to give clarity and to implement this framework as quickly as possible,” he said at the forum for policymakers.

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The promises punctuated a change of tone from London after Sunak, an investment professional and former Chancellor of the Exchequer, drew fire for falling through on stoking crypto business in post-Brexit Britain.

On Monday, Sunak hit the reboot button on his crypto cred by welcoming a16z, the Silicon Valley venture capital firm that has committed $7.6 billion to startups in the crypto and web3 marketplace.

‘The right regulators are the financial regulators with their deep expertise and understanding of issues like how to ensure markets are fair and how to protect consumers.’

—  Andrew Griffith

No. 10 Downing Street appears to be keen on drawing a contrast with the US, which is in the throes of a regulatory crackdown. But London is playing catch-up with the European Union, which is already implementing a crypto law called MiCA that has won praise from crypto industry leaders for its clarity.

Still, crypto regulation in Europe remains in flux — today DL News reported that proposed legislation for data may be a disaster for DeFi protocols in the way it is defining smart contracts.

NOW READ: EU data bill threatens to upend smart contracts in potential blow for DeFi

Griffith also addressed an eyebrow-raising recommendation from the Parliament’s Treasury Committee in May that proposed crypto be regulated the same way as gambling enterprises. Crypto leaders were aghast at the idea, and pointed out that doing so might make trading Bitcoin and other tokens tax free.

“I refute that, that is not the Parliament’s position,” Griffith said. “The right regulators are the financial regulators with their deep expertise and understanding of issues like how to ensure markets are fair and how to protect consumers.”

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Yet challenges remain in the UK. Cameron, who together with the cross-party group published a report with latest findings on the sector, noted that many banks refuse to provide accounts to crypto firms, even if they are licensed.

This could be the “single biggest barrier to growth” for the UK’s crypto secretary and could “fundamentally undermine the government’s ambitions,” according to Cameron, who is urging the government to address the issue.

Have tips on crypto regulatory policy? Contact the author at inbar@dlnews.com.