Ripple, which has gained itself a reputation as a popular choice for financial institutions, has reportedly called on legislators in the UK to step up their regulatory game when it comes to cryptocurrency.
The ticket is to find the sweet spot between “capturing risk and enabling innovation,” according to Ryan Zagone, Ripple’s head of regulatory relations. “We’re at that time now where we need more clarity and rules and we need more certainty,” he said in a Telegraph report.
The right kind of regulations could create “the guardrails on the highway that allows new entrants to come in, particularly institutional investors,” he explained.
‘Slow and Steady’ Isn’t Going to Cut it Anymore
Zagone added that regulators should focus their efforts on three “pillars” of legislative intention: financial stability, consumer protection, and anti-money laundering.
“It’s a good time to start revisiting that ‘wait and see’ approach taken by regulators,” said Zagone, most likely referring to the regulatory attitude with which most Western countries have approached cryptocurrency. The US, the UK, and most countries in the EU have taken a rather slow-and-steady approach toward regulating crypto.
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Instead, Zagone, said that Western nations should be looking to Japan’s crypto laws as a blueprint for their own regulations. Following the massive Mt Gox hack in 2014, Japan enacted a comprehensive set of crypto regulations in its Virtual Currency Act of April 2017. Among other things, the act legitimized Bitcoin and Ethereum as legal means of payment and outlined a licensing procedure for exchanges.
The UK’s Regulatory Climate Is Getting Hotter – Slowly
The UK has indeed taken some steps toward regulation around cryptocurrency. Last month, Chancellor Phillip Hammond launched a task force to “manage the risks around crypto-assets.” The team is comprised of members of the Treasury, the FCA, and the Bank of England.
In early March, Bank of England governor Mark Carney expressed his desire to ramp up crypto regulation, citing “speculative mania” around the volatility of crypto assets.
Several of the world’s largest crypto firms joined forces earlier this year to form CryptoUK, a self-regulatory body for the cryptocurrency space. In fact, crypto companies around the world are turning to self-regulation as a way to legitimize their business practices as governments hesitate to regulate.
In an exclusive interview with Finance Magnates earlier this year, CryptoUK Chairman Iqbal Gandham said that the organization was formed to be a body “which the masses and the wider audience in the UK would understand in terms of what crypto is, how we want to regulate it, and what the best practices that we as organizations choose to follow.”