Indeed, the recent crash in the crypto market brought many crypto projects on the verge of collapse and paused the developments in the industry. But as prices of cryptocurrencies showed significant gains, green lights appeared in the surroundings.
Published on Wednesday by the lower parliament house of the UK, the long-awaited Financial Services and Financial Markets Bill, aimed at expanding the country’s reach in the financial world, allowed the use of stablecoins to run digital payments in the state.
The UK has attempted to modify its financial policies for better productivity since it exited the European Union (EU). Similarly, this bill comes as part of the Brexit, which took effect at the starting of 2020, and now the country strives to make the country a tech hub and hold its position as a big player. Hence, it moved to the regulation of stablecoins ending last month via the Market in Crypto Assets (MiCA) bill.
MiCA bill typically focuses on the sizeable stablecoin issuer to prevent the crash as TerraUSD previously stunned the crypto enthusiasts worldwide. It will bring more strict and prudential rules for a stablecoin issuer with limits on hefty withdrawals and apply the cap to those surpassing 200 million euros in daily transactions.
The UK Develops Sandboxes To Fintech Products
Alongside bringing the nascent technology into the country’s financial system, the new bill also includes establishing Financial Markets Infrastructure Sandboxes for testing new technology and finding what could make the system more effective.
Sandboxes, the isolated platform for tech companies to test a fintech product or crypto before it goes into the market for public use, will improve the experience, transparency, and efficiency.
The newly appointed Chancellor of the Exchequer, Nadhim Zahawi, said in a statement;
Today is a landmark day for financial services in the UK.
Nadhim further urged that the government must maintain high regulatory standards to preserve the UK’s position as a competitive financial center. The new bill has reformed the previous EU-derived rules applied to UK capital markets to ensure that legislation remains fair and result-based.