The UK Banking Regulatory Authority proposes issuing cryptocurrencies and delays their regulation until the completion of Basel III

The UK’s banking regulator, the supreme regulator (PRA), will enforce rules and regulations relating to the issuance and holding of digital assets, said Vicky Saporta, executive director of the supreme regulator at the Bank of England (BOE), in her speech at the bank on February 27. ; The new laws will be developed taking into account the laws of the Basel III agreement and the Financial Services and Markets Bill currently being considered by Parliament.

The Financial Services and Markets Bill, which had its second reading in the House of Lords in January, would give the supreme regulator the secondary objective of facilitating international economic growth in the UK; To this end, Saporta said, “The regulation imposed by the PRA can do three things: harness the UK’s strengths as a global financial center and maintain confidence in the UK as an ideal place to do business, while adapting regulations.” Regulatory with UK conditions.” She added:

“We will also propose rules and laws about issuing and holding digital assets.”

Saporta said the Bank of England and the PRA are working with six other agencies to create a “regulatory network that will deliver all our plans in one place”. This new regulatory framework will replace the current “maze” of regulations, of which EU rules occupy a large part.

It is worth noting that the United Kingdom withdrew from the European Union in 2020.

Saporta said that the PRA will “consult on the implementation” of the Basel 3.1 standards once finalized. These standards will call for banks to limit their cryptocurrency exposure to 1% of their capital, with a risk premium of 1,250%; The European Union is considering similar legislation; Saporta said:

“I also think it’s usually easier for internationally active companies to follow one global rulebook than having to adapt to a patchwork of local standards.”

According to Saporta, the Financial Services and Markets Bill will expand the existing BoE regulations for electronic money and payment systems to include stablecoins; After consultations, the PRA determined that the “new standards for firms regulated by the PRA should be consistent with the rules for other sectors.

Very irritating @bankofengland speech today from its executive director for prudential policy

Vicky Saporta asserts the BoE’s new secondary objective will spur change.

She talks about changes BoE is implementing.

Never once explains how the former drives the latter

– Chris Giles (@ChrisGiles_) February 27, 2023