The Cryptoassets Taskforce of the United Kingdom proposes some changes for cryptocurrency regulation. It especially raises concerns over the way digital assets like coins and tokens are being traded and used. The taskforce published their report on the current regulations on October 29th.
The report stated lots of obvious facts, including the risk of fraud and cybercrime. The main objective of the taskforce – which is made up of the Bank of England (BOE) and the Financial Conduct Authority (FCA) – was to develop a framework that considers three types of cryptoassets, each with three common uses.
- Exchange tokens – means of exchange, to facilitate regulated payment services, for direct investment and for indirect investments
- Security tokens – as a tool for capital raising, direct and indirect investments.
- Utility tokens – capital raising tool, direct and indirect investments.
The report states that cryptocurrency that’s used on an exchange can not be seen as a currency or money due to its high volatility and poor acceptance as means of exchange. Crypto is better used as an investment, but this can expose consumers to ‘inappropriate levels of risks’. Therefore things like Bitcoin futures and contracts for difference (CFD) will be prohibited for consumers.
The new guidelines proposed by the taskforce are not set in stone yet. The government will now look at the proposals and talk to people in the market before making a decision in the first quarter of 2019.