A former Chancellor of the United Kingdom has raised concerns the country is slipping behind its rivals in the European Union when it comes to the cryptocurrency regulation.
Philip Hammond, who served as the U.K.’s Chancellor of the Exchequer from 2016 to 2019, told Bloomberg that there has been a distinct lack of direction and cohesion when it comes to crypto policy:
“Particularly in the area of digital asset trading, I feel that the UK has missed a trick [...] We are getting very close to the point where it will be too late. Other jurisdictions are racing ahead of us.”
“The problem is that there are no regulations, and nobody quite knows where they stand, right? It's a bit of a wild-west, and has gained, frankly, a mixed reputation, particularly among policymakers and politicians and the public.”
He also stressed that the development of digital trading infrastructure will be key to turning the U.K. into a hub for trading tokenized traditional assets, such as tokenized equities and tokenized bonds.
“Getting this right, getting the rules around digital trading right, will be an essential prerequisite for being a player in the digitization of traditional financial assets:”
“The jurisdictions that have embraced this technology that have regulated it properly and effectively will be the ones that develop these markets and they will become the new hubs.”
The former minister’s criticisms came despite promises from the U.K. government in May to introduce legislation to regulate the crypto industry.
Hammond said that while the country has been “very agile in embracing new technologies” in the past, this hasn’t been as apparent when it comes to crypto regulation, adding that it was likely due to a mix between a “bandwidth issue” and a “capacity issue.”
“This is a very new area of technology. It’s very difficult for public sector bodies with public sector pay structures to recruit the best and the brightest into these areas.”
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“Personally, I think the [Financial Conduct Authority] FCA should have gone to the industry and said we need secondees. We can’t, you know, we can’t hire the people we need. We need the industry, to provide us with the talent to work up the regimes we need to introduce.”
In their defense, Hammond said that regulators have been dealing with a period of immense stress dealing with the consequences of Brexit, COVID-19 and its impact on their own working arrangements.
Hammond is no stranger to the crypto industry, currently serving as a senior adviser to copper.co since October 2011, a London-based start-up firm that provides custodial and infrastructure services in the digital asset sector.