In the United Kingdom, seven of the largest cryptocurrency exchanges and other crypto companies are forming a trade body to impose self-regulation on digital coins.
According to The Telegraph, CryptoUK reportedly produced the first code of conduct by which the nascent industry must abide.
CryptoUK chair Iqbal Gandham, who is also the managing director of eToro, admits to the risk of “rogue operators” in this industry, but he is optimistic with the self-regulatory body, as it had been established “to promote best practice and to work with government and regulators.” The Telegraph further quotes Mr. Gandham: “We hope it can form the blueprint for what a future regulatory framework will look like.”
CryptoUK members include major global cryptocurrency exchanges such as Coinbase and trading platforms eToro and CryptoCompare. Coinbase UK CEO Zeeshan Feroz says “The fundamentals are engaging as a single industry with the government. Regulation is imminent and that’s a good thing.”
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Four popular cryptocurrency companies — BlockEx, CEX.IO, CoinShares, and CommerceBlock — join the trade body.
All trade body members must sign a code of conduct. According to CryptoUK, this ensures greater due diligence against any illegal activity and in the event of insolvency, ensures that customer funds can pay out. Furthermore, self-regulations safeguard the vulnerable industry from cyberattacks.
Regulations in the EU
The authorities in the UK and the EU maintain a tough regulatory stance with Bitcoin and other cryptocurrencies. Recently warnings issued speak to Bitcoin investments as “a bubble.” Earlier, both EU and UK regulators had threatened to crack down on cryptocurrencies.
European Union top banking, securities, and pensions watchdogs say in a statement: “[Cryptocurrencies] are highly risky, generally not backed by any tangible assets and unregulated under EU law, and do not, therefore, offer any legal protection to consumers.”