In an atmosphere reminiscent of a frenzied game of poker, a group of British lawmakers recently spoke out on the speculative nature of cryptocurrencies. According to them, cryptocurrency trading should be regulated as gambling, rather than a financial service. This bold proposal shakes up the crypto trading world and raises important questions about the future of cryptocurrencies.
A casino flavor in the digital air
It was not the volatility of roulette or the suspense of poker, but the uncertainty of the value of cryptocurrencies that prompted the House of Commons Treasury Committee to recommend ” game of chance “ for crypto trading.
This position is based on the idea that the volatility and lack of intrinsic value of unbacked cryptocurrencies pose a significant risk to consumers.
Based on statements by Dr. Larisa Yarovaya, Associate Professor at the University of Southhampton, the committee maintains that cryptocurrency speculation can be addictive, just like the game.
Hence the need for regulations as strict as those applied to the gambling sector.
Treasury Committee Chair Harriett Baldwin has expressed concerns about the potential halo effect that could arise from regulating cryptocurrencies as a financial service.
According to her, this could lead consumers to believe, incorrectly, that these activities are safer than they really are.
A lucid look at the potential of cryptocurrencies
Despite these concerns, the committee recognizes the potential of cryptocurrencies and their underlying technology.
Indeed, the latter can bring significant benefits to financial services and markets, such as reducing the costs of cross-border payments and improving financial inclusion.
The committee therefore believes that it is essential to have an effective regulatory framework in place to support these developments while mitigating some of the risks associated with cryptocurrencies. He thus welcomed the British government’s proposals on how it plans to regulate cryptocurrencies used in financial services.
The proposal by British lawmakers to regulate cryptocurrency trading as a game rather than a financial service is surprising.
However, on closer inspection, it highlights the risks inherent in this growing sector, while acknowledging the revolutionary potential of cryptocurrencies.
In this high-stakes game of poker, the UK seems determined not to give in to the challenges of cryptocurrency regulation. The debate is on the carpet: are cryptocurrencies a simple Russian roulette or do they represent a new financial El Dorado? The answer to this question will undoubtedly condition the way we approach the future digital age. It may be time to consider the end of the crypto exodus in the UK as a concrete possibility.
Receive a digest of news in the world of cryptocurrencies by subscribing to our new service ofdaily and weekly so you don’t miss any of the essential Tremplin.io!