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UK Government Minister Calls for 'Proportionate' Crypto Rules

The U.K.’s City Minister, John Glen, told reporters at the Treasury’s International Fintech conference on Thursday that “proportionate” regulations could give the local cryptocurrency industry a significant boost.

In his comments, Glen said the government is still “engaged in trying to find the right narrative and the right level of regulation if that’s appropriate,” according to Business Insider.

The minister continued, saying:

“Regulation could be an enabler of a stable, flourishing cryptocurrency exchange in the City of London.”

Notably, the minister acknowledged that the current level of cryptocurrency trading and related activities is “not posing any significant risk to the UK economy.”

That same day, Chancellor Philip Hammond announced the establishment of a new “cryptocurrency task force” including regulators, representatives from the Bank of England and the Treasury. A new legal infrastructure for the U.K. blockchain industry could be on the horizon.

Earlier this month the U.K. cryptocurrency exchange CoinfloorEX announced it will start offering bitcoin futures contracts in April. Although London is teeming with blockchain projects and startups, so far the most popular exchanges operate out of the United States or Asia.

Glen stressed the importance of taking measured steps before trying to encourage local innovation with more legal clarity, saying:

“I think it’s right that we take appropriate — not really cautious, but proportionate — steps to evaluate it before we act as a government.”

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Blockchain Can Help UK 'Stay Relevant' After Brexit, Says EU Lawmaker

A British Member of the European Parliament (MEP) has called on the City of London and the Bank of England to embrace blockchain technology as a means of staying relevant in the post-Brexit era.

Kay Swinburne, who is also the most senior legislator on the EU’s Economic and Monetary Committee, told Business Insider that “the conservative status quo is now too risky with Brexit,” and that the U.K. must embrace distributed ledger technology (DLT) to make its markets more efficient.

Swinburne reportedly said:

“The UK post-Brexit: how does the City of London stay relevant? The City of London stays relevant by suddenly becoming the proponents of the new technologies and not just patching existing systems to make them work post-Brexit, actually leapfrogging.”

The MEP added that she felt that a post-Brexit Britain was better positioned than the EU to benefit from blockchain technology, but only if it is prepared to take risks.

Comparing the blockchain moment with the “Big Bang” of the 1980s – an uptick in market activity after the swift deregulation of the markets under Margaret Thatcher – she said, “We’ve got proof of concept of DLT in so many areas. It now needs to be scaled up. We’ve got to take some risks. We have the opportunity to really make a difference in a way that I don’t think Europe post-Brexit is going to be able to do.”

The Conservative Party MEP also appealed to the Bank of England to incorporate blockchain into a more modern monetary policy vision, arguing it should be the first central bank to “open up” and accept that future monetary policy “doesn’t involve issuing notes all the time, maybe it involves other alternative payment systems.”

The U.K. has demonstrated continued interest in blockchain. Most recently, the government’s technology development arm, Innovate UK, announced in January that it plans to invest £19 million ($26.6 million) in projects contributing to “the fields of emerging and enabling technologies” including distributed ledger technologies.

Previously, in late 2016, the nation’s finance watchdog, the Financial Conduct Authority, launched a regulatory “sandbox” to provide a number blockchain-focused startups a test environment for new financial products.

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