The Bank of England urged to regulate cryptocurrencies by analogy with the traditional market

The Bank of England urged to regulate cryptocurrencies by analogy with the traditional market

The Bank of England urged to regulate cryptocurrencies by analogy with the traditional market

Cryptocurrencies should be regulated by analogy with traditional finance in order to reduce risks in the industry and increase investor confidence. This was stated by Deputy Governor of the Bank of England John Cunliffe.  

During the press conference, the official recalled the collapse of the Terra ecosystem. According to him, digital assets cannot maintain their value and stability, causing stress in the markets.

“For me, this highlights the fact that now we need introduce a regulatory system that will manage these risks in the crypto world in the same way that we manage them in the regular world,” Cunliff noted.

He acknowledged that cryptocurrencies have “real potential to be exploited in the financial system.” However, the deputy head of the Central Bank did not rule out that the rules would have to be “tailored” to the industry due to its differences from the traditional financial system.

Earlier, the Bank of England stated the importance of monitoring the digital asset market. The regulator also called for strengthening the regulatory and enforcement framework in this direction.

Recall that in March, the British Central Bank introduced an approach to regulating cryptocurrencies with an emphasis on future risks to financial stability.

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