UK Treasury Set to Dominate Crypto Regulation Under FCA by 2027

• The UK Treasury will regulate cryptocurrencies under the FCA regulatory umbrella from 2027. This will promote transparency.
• A total of 61,000 BTC (£5 billion) was seized in the scam, signaling strict enforcement ahead.
• Consumers in the UK have suffered a 55% increase in investment scam losses each year, but new regulations will help protect them.

The UK Treasury is preparing rules to bring cryptocurrencies under Financial Conduct Authority (FCA) supervision starting in 2027. Cryptos such as exchanges, wallets, and other digital assets will be subject to the same treatment as other financial products.

Currently, markets operate with less regulation than stock and bond markets. Consumers do not have the same rights they would in other markets. The Treasury said stricter rules would boost confidence and make it easier to spot suspicious activity. Companies failing to comply could face sanctions, while those operating transparently would benefit from a clear regulatory framework.

Crypto Oversight and Consumer Protection

As Chancellor, Rachel Reeves drew attention to how the regulation will better position the UK as a financial hub. With regulation, companies will be in a better position to invest, innovate, and develop skilled jobs in the UK. Consumers will benefit from better protection. 

Crypto firms have to register with the FCA if they provide a service covered by money laundering laws. Exchanges, wallets, and other such sites will now have transparency requirements. “The UK wants to attract crypto firms with a clearer and more consistent regulatory vision,” stated Lucy Rigby, Minister for the City of London.

Consumers in the UK have lost 55% more in a year when it comes to investment scams. Law enforcement is working towards reducing fraud.

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High-Profile Cases and Political Donations

One of the major cases of fraud relates to Zhimin Qian, in which he kept £5 billion in bitcoin. A total of 61,000 bitcoins were seized, which is the largest single crypto-seizure globally. Qian pleaded guilty to taking custody to illicit activities. Additionally, ministers are drawing up plans to ban making political donations using crypto to promote financial transparency.

Reform UK remains the first political organization to accept donations this year. They have reported taking their first registrable crypto donations. The Treasury’s move marks a major change, bringing crypto in line with conventional financial systems and ensuring a standard of safety for consumers in the market in the UK.

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