The rise and popularity of cryptocurrency have led to interest from the UK parliamentary treasury committee. The MPs have today stated that they were launching an inquiry into cryptocurrencies and also the distributed ledger technology. The parliament wants a clear understanding of the role of the cryptocurrencies in the UK. More to that they also want to understand the opportunities in blockchain technology as well as the risks of cryptocurrencies to the government, businesses and the customers.
According to comments from Alison McGovern who is a member of the Treasury Committee:
“The inquiry is coming at the right time because regulators and governments are fighting to understand the recent events in the crypto market. New technology is always important to the world, but it can also come with many risks. Whitehall and Westminster should to understand digital currencies better and also more about the blockchain technology.”
More to the inquiry the MPs will also look into the regulatory response to cryptocurrencies from the Financial Conduct Authority, the government and also from the Bank of England. The Committee wants to see how the regulation will balance between customer protection and market protection.
According to Nicky Morgan who is the Chair of the Treasury Committee: “People are continuing to gain more knowledge about digital currencies and especially Bitcoin, but they may not be aware that the currencies are currently not regulated in the UK. The committee will scrutinize the market to understand all the potential risks that the currencies can have to customers, the government and businesses. More to that we will also look into money laundering and cyber-crime.”
Despite the high volatility and especially in Bitcoin people still, see these digital currencies to be having a powerful potential application for both the internet and finance. Morgan added that:
“We are also going to look at the Blockchain technology which is the underlying technology for digital currencies. We want to know how it can create innovative opportunities and to what extent it can disrupt the economy while trying to replace the traditional means of payment.
In conclusion, we want to strike the right balance between regulating cryptocurrencies to ensure that customers are protected while we are not stifling innovation. As part of this inquiry, we will try to explore how that can be achieved.”