News
Government looks at introducing greater cryptoasset regulation
Expect changes to the way cryptoassets are regulated following a number of market disturbances, including the recent collapse of the FTX crypto exchange, one of the world’s largest.
If you invest in cryptoassets, you may be aware that the Treasury is currently consulting on the best way to regulate a large number of cryptoasset activities.
In April 2022, the Government announced plans for a new regulatory regime for cryptoassets and is using the consultation to gather views on the best way to proceed.
Cryptoassets have become more commonly owned in recent years with the consultation noting that a majority of recent surveys show that 5-10% of UK adults now own cryptoassets, a significant increase over the past 1-2 years.
Given this increased holdings of cryptoassets, the Government are keen to understand how better to protect investors from the type of events which have led to such a turbulent year
Volatile times for cryptoassets
As stated in the Treasury Consultation, the total global market capitalisation of cryptoassets recently stood at around $0.8 trillion, which is roughly 75% below a peak of around $3 trillion in November 2021. The total valuation of cryptoassets changes daily, and this 75% fall represents a significant fall in value over a short period of time.
More safeguards for cryptoassets
Concerns regarding the unregulated nature of cryptoassets were heightened when FTX Trading Ltd., commonly known as FTX failed. The failure of FTX, a major crypto exchange, has raised important questions around conflicts of interest, market conduct and operational resilience.
The consultation is considering several changes to provide more safeguards, operational risk controls, data reporting arrangements, and good governance to give investors more protection.
Andrew Griffith MP, Economic Secretary to the Treasury, said, “Our objective is to establish a proportionate, clear regulatory framework which enables firms to innovate at pace, while maintaining financial stability and clear regulatory standards. This includes a proposal to bring centralised cryptoasset exchanges into financial services regulation for the first time, as well as other core activities like custody and lending.”
Need help with your crypto taxes?
If you are currently investing in, or considering disposing of cryptoassets, we can advise on crypto tax planning opportunities that could mitigate or reduce your potential tax liabilities. Call 01380 829 888 or use our online enquiry form to book a free video or face-to-face consultation.
Date published 7 Feb 2023 | Last updated 20 Mar 2024
Choose the right accounting firm for you
Running your own business can be challenging so why not let TaxAssist Accountants manage your tax, accounting, bookkeeping and payroll needs? If you are not receiving the service you deserve from your accountant, then perhaps it’s time to make the switch?
Local business focus
We specialise in supporting independent businesses and work with 100,000 clients. Each TaxAssist Accountant runs their own business, and are passionate about supporting you.
Come and meet us
We enjoy talking to business owners and self-employed professionals who are looking to get the most out of their accountant. You can visit us at any of our 409 locations, meet with us online through video call software, or talk to us by telephone.
Switching is simple
Changing accountants is easier than you might think. There are no tax implications and you can switch at any time in the year and our team will guide you through the process for a smooth transition.