UK Crypto Firms Urge Regulators to Forge Their Own Path Amidst US Pressure
According to some American lawmakers and businesses, the U.S. government’s approach to regulating the crypto industry is hampering innovation due to its confusing and heavy-handed nature.
However, Web3 companies are hoping that the UK will not follow in the same footsteps.
Today, a16z, the crypto-focused division of VC behemoth Andreessen Horowitz, has urged the UK Treasury to adopt a more “nuanced” approach to regulation and steer clear of the US approach.
In February, the UK released its initial regulations to oversee the crypto sector, in which the Treasury stated its intention to regulate crypto exchanges in a similar way to traditional financial institutions.
On Monday, Brian Quintenz, Head of Policy at a16z, tweeted his enthusiastic support for the U.K.’s “proportionate and focused, agile and flexible” regulatory regime, stating that the investment firm is eager to work with the Treasury to establish world-class rules that will protect consumers and promote innovation.
Last month, a16z cautioned that the U.S. was losing ground in the digital asset arena. The British government has expressed a desire to establish itself as a “global crypto asset technology hub.”
In addition to a16z, Polygon Labs also voiced their support for U.K. regulation, with Chief Policy Officer Rebecca Rettig calling the U.K. consultation “excellent” and stating that the company is “incredibly encouraged” to see the industry being regulated.
Polygon Labs, the entity responsible for the Polygon blockchain network and the 10th largest cryptocurrency, MATIC, has recommended that “unbacked cryptoassets” such as Bitcoin be treated differently from tokens and coins with a development team or an underlying asset.
Brian Armstrong, CEO of Coinbase, the largest US crypto exchange, also praised the UK for implementing “sensible crypto regulation” to drive economic growth and safeguard consumers.
Coinbase is actively seeking rapid overseas expansion. Nevertheless, after the collapse of FTX, American regulators, especially the Securities and Exchange Commission (SEC), have become more aggressive in encouraging compliance from major crypto brands.
SEC Chairman Gary Gensler has targeted Kraken, Bittrex, and Coinbase for allegedly selling unregistered securities.
Republican politicians are critical of regulators, claiming that they are forcing tech companies to relocate offshore. Consequently, the UK seems ready to welcome crypto companies that may be displaced.