Investigation on Cryptocurrencies Launched by the UK Government

The UK Parliament’s Treasury Committee aims to launch an investigation into cryptocurrencies in order to examine how the virtual currencies such as bitcoin impact investors and businesses in Britain.

Even as the cryptocurrencies have increased in popularity (and in value), their future has remained to be unclear. Numerous countries have already adapted by aggressively cracking down on ICOs, cryptocurrency exchanges, and some other elements of the new industry.

On the other hand, other governments are more careful in their approach. However, for a global industry that is notorious for its extreme volatility, even the slightest sign that a country may be studying to step in with further regulations can send markets plunging.

The inquiry was announced on the 22nd of February. According to a report that was released by Coin Telegraph, it will explore how the cryptocurrencies affect investors, businesses, and consumers in the United Kingdom. The Treasury Committee cited the media hype that is surrounding virtual currencies and their shifting price movements for the examination.

According to Nicky Morgan, the Treasury Committee chair, the said investigation “will look at the potential risks that digital currencies could generate for consumers, businesses, and governments, including those relating to volatility, money laundering, and cyber-crime. We will also examine the potential benefits of cryptocurrencies and the technology underpinning them, how they can create innovative opportunities, and to what extent they could disrupt the economy and replace traditional means of payment.”

Currently, cryptocurrencies are widely unregulated in the United Kingdom, and the inquiry is said to be broad in its mandate. However, it will reportedly include hearings on how regulation might be beneficial in terms of the trust of consumers. Beyond that, the investigation intends to explore how the cryptocurrencies could continue to develop into the future, and particularly if the digital currencies could ever sufficiently replace the traditional payment systems.

There have been no suggestions that the UK government is interested in introducing regulatory measures in order to control the ICO launches or cryptocurrency exchanges that are taking place in the United Kingdom. Nonetheless, in an industry which shifts quickly and dramatically, there is no doubt that investors would want to watch to see how the inquiry unfolds in the coming months.