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US and UK Have Diverging Views on Cryptocurrencies and Fintech
Based on the policies involving cryptocurrencies and Blockchain technologies, UK moves to liberalization of cryptocurrencies while the US looks into more regulations.
The World Bank estimates $429 bln of remittance market in 2016. This is mostly from migrants sending remittances to their home nations, mostly done through traditional banks and other non-bank payment systems, and P2P systems.
To leverage this growing industry, the UK is finding ways to integrate Britain’s interbank payments and encourage further liberalization of P2P systems. Consequently, It is exploring ways to officially integrate cryptocurrency, testing Ripple’s Blockchain technology for cross-border payments.
The move by both the banking industry and the UK Government in keeping up with the times. Meanwhile, across the Atlantic, US regulators are in line with the lessons learned from the last depression and the Patriot Act, are trying to find ways to establish more regulations in this emerging trend.
Bitcoin Foundation warns that the US is moving backwards in terms of accepting cryptocurrencies and other peer to peer banking models, which could result in the US Banking system being left behind.
The mentality is not entirely baseless, cryptocurrency trading with its anonymous nature can lead to money laundering, and since the US uses banks and the flow of money in many forms of Law Enforcement, it is easy to see how digital assets being used currently is a problem for the US.
The Uniform Law Commission is meeting in San Diego and they proposed a draft legislation called the Uniform Regulation of Virtual Currency Businesses Act, Even if many cities and states at the State and local level see the benefits of deregulating virtual currencies. The US Federal government seems to be heading the other direction.
Meanwhile, Britain's new system will give fintech corporations more freedom allowing them to compete on the world stage.
Bank of England Governor Mark Carney said in a statement that this move will help:
“Support financial stability through greater diversity and risk-reducing payment technologies."
BOE believes that providing competition to traditional banks will be beneficial, not only to the fintech industry but the banking industry as a whole.
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