Cryptocurrency regulation in the UK: Timeline & Impact

The genesis of bitcoin.

HM Revenue & Customs (HMRC) releases a brief on the tax treatment of cryptocurrencies. Anyone making revenue from cryptocurrency, such as mining, trading, exchanges, payments, or services, is eligible for tax.

Bitcoin halving happens.

FCA releases a discussion paper on distributed ledger technology (blockchain). Users were asked to respond to the question by July 17, 2017.

The FCA publishes responses given by users on distributed ledger technology (blockchain).

The “Cyberassets Taskforce” was established, consisting of the FCA, the Bank of England, and Her Majesty’s Treasury. The main aim was to find out how and when cryptocurrency can be regulated in eight different sectors, including trading, mining, and investment.

For the first time “Cryptoassets Taskforce,” gather around the table in the presence of senior leaders from the government and the financial regulators. The taskforce agreed on a variety of objectives.

The Cyberassets Taskforce publishes its first report and provides an overview, including risks and potential benefits. The taskforce wants to maintain the UK’s international reputation and inform businesses about cryptocurrency regulation in the UK.

FCA released the first chapter on “Guidance on Cryptoassets.” In the report, the FCA outlines its proposed approach to regulating cryptocurrencies and related activities in the United Kingdom.

The Financial Conduct Authority (FCA) released a chapter 2 report on “Guidance on Cryptoassets.” The aim of the report is to set parameters for cryptocurrency regulation in the UK. This report basically focuses on consumers in the UK who want to buy and sell cryptocurrency.

The FCA published a consultation paper detailing the fee and registration process for cryptocurrency businesses under anti money laundering. A registration fee of £2,000 is payable for firms with income up to £250,000 and £10,000 for firms with income in excess of £250,000.

FCA becomes the head supervisor for anti-money laundering (AML) and counter-terrorist financing (CTF) for businesses carrying out certain cryptocurrency activities in the UK. Also, some trade associations, like the British Bankers’ Association (BBA), the Building Societies Association (BSA), and the Association of British Insurers (ABI), have set up the Joint Money Laundering Steering Group (JMLSG), which helps counter AML.

Therese Chambers, Director of Retail and Regulatory Investigations at the FCA, gives a speech on financial risk crime. The director said, “Cryptoassets are an attempt to rebuild the financial system from the ground up, without the traditional financial institutional framework.” Also, mention cryptocurrency such as bitcoin and ethereum, which present different financial crimes from traditional finance.

FCA publishes a friendly reminder to cryptocurrency businesses to complete registration by June 30, 2020, which was published on October 15, 2019.

HM Treasury publishes a consultation paper on financial promotion. This paper wants to bring cryptocurrency promotion under the traditional finance system to ensure the same standards of fairness, clarity, and accuracy.

FCA released a statement prohibiting the sale to retail clients of investment products that reference cryptoassets. FCA believes cryptocurrency has no reliable value and has a high risk of volatility. They also mention that banning cryptocurrencies could reduce harm by £19 million to £101 million a year for retail investors.

A temporary regime established by the FCA for the cryptocurrency business. This allows cryptocurrency firms to continue tarding until July 9, 2021, while their registration is still pending.

HM Treasury published its consultation on the UK regulatory approach to cryptoassets and stablecoins, together with a call for evidence on distributed ledger technology in financial markets.

HM Revenue & Customs publishes a cryptocurrency manual and clarifies the tax treatment in it on cryptocurrency profit. The tax slab is in two parts: 10% or 20% and 20% to 45%.

British finance minister Rishi Sunak called on the Bank of England to look into digital currency. This digital currency is called Britcoin.

The FCA extended the temporary registration regime. The new date to join the Temporary Registration Regime is now March 31, 2022.

The temporary registration regime established by the FCA has now ended.

HM Treasury published the consultation document ‘Managing the failure of systemic digital settlement asset (including stablecoin) firms’.

HM Treasury publishes a consultation outcome about the future financial services regulatory regime for cryptocurrency.

Major cryptocurrency Binance has stopped its services in the UK because the FCA denied permission. Some platforms, such as Bybit, PayPal, and Luno, have also stopped their services.

HM Treasury publishes a final proposal on the future financial services regulatory regime for cryptocurrency regulation in the UK.

HM Revenue & Customs hit UK users with penalties for unpaid cryptocurrency tax.

Financial Conduct Authority (FCA) and Bank of England comes under the insurance policy provided to registered firms that allows them a safe space where they can tokenize traditional assets like stocks and bonds using blockchain.