UK’s Oversight of Digital Assets

In her speech at City Week 2023, Sarah Pritchard, Executive Director of Markets and Executive Director of International at the FCA, discussed the increasing popularity of cryptocurrencies and the need for regulation in the industry. Pritchard highlighted that while cryptoassets and blockchain technology offer opportunities for innovation and efficiency in financial services, they also pose risks to consumers. She emphasized that consumers must be prepared to lose all their money when investing in crypto and called for crypto promotions to be treated as high-risk investments. Pritchard emphasized the importance of industry input in shaping the future regulatory regime for cryptoassets and urged policymakers, investors, and consumers to have a conversation about the limits of regulation and the appetite for risk. She also discussed the rise in crypto-related crimes and scams and the FCA’s role in preventing harm to consumers. Pritchard mentioned the FCA’s current remit over crypto, which is limited to ensuring compliance with anti-money laundering and counter-terrorism legislation, and expressed the need for more powers to regulate the industry. She also touched on the FCA’s efforts to work with international counterparts to boost market integrity and protect consumers in the global crypto market. Additionally, Pritchard mentioned the ongoing consultation on the regulation of stablecoins and the wider cryptoassets regime and encouraged industry participants to provide their input. She concluded by emphasizing the importance of open debate about the risks and benefits of cryptoassets and the need for collaboration between industry, policymakers, and consumers to shape effective regulations that benefit all stakeholders.

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