The new set of crypto assets regulatory proposals in the UK aims to bring DeFi under the scope of the law. The DeFi will be on a case-to-case basis.
The United Kingdom is actively looking to regulate the crypto market and has proposed many new policies to bring various crypto markets under the rule of law. Though, among the various newly proposed suggestions, what turned many heads is the request to remove blockchain. Further, Distributed Ledger Technology (DLT) references from the definition of crypto also contributed.
Moreover, the new report titled “Crypto Asset promotions: Consultation response” from Her Majesty’s (HM) Treasury noted that:
“While most crypto use DLT or blockchain as an underlying technology, it might change over time as the industry evolves. Thus, crypto assets must be exempt from the reference of DLT to “future-proof the definition of innovation
The official statement said:
“Most crypto assets currently use distributed ledger technology (DLT); it might be that this changes as the technology and industry evolve. Therefore, the government proposes to remove the reference to DLT from the definition of qualifying crypto assets. “
Apart from the controversial crypto definition change, the HM Treasury paper also discussed bringing decentralized finance (DeFi) under the scope of regulation on a case-to-case basis
The official paper read:
“Whether certain crypto assets lending activities or decentralized finance platforms are within the scope of the regime. They ultimately depend on the activities being promoted.
