HMT confirms regulatory framework for digital assets

HM Treasury (HMT) published three papers related to regulated cryptoassets and stablecoins on 30 October 2023, confirming the intention to bring a number of cryptoasset and stablecoin activities into the regulatory perimeter for financial services.

In its response to the Future financial services regulatory regime for cryptoassets, HMT confirms it will bring forward a new regulatory regime for wider cryptoassets, largely as consulted on earlier in the year. The Government’s aim is for the secondary legislation to be laid in 2024, followed by regulatory consultations.

HMT also published an update on its planned approach to regulate fiat-backed stablecoins. The Government commits to bringing forward secondary legislation as soon as possible, by early 2024, to enable the FCA to regulate fiat-backed stablecoins. This forms phase 1 of the plan to regulate cryptoassets.

It also issued a consultation response on managing the failure of systemic ‘digital settlement asset’ firms, including stablecoins.

Download this Hot Topic for a detailed analysis of the statements.