Letters: Don’t bite down on Bitcoin
[Re: Britain will be left in the dust with our tepid attitude to cryptocurrencies, Jan 27]
Matt Hancock claims the UK can become the home of fintech and crypto, but only with the right regulatory regime. The secret to that success is finding the right balance.
As it stands, too little regulation is harming consumer confidence. You only have to look at those who have learnt the hard way from the ‘hidden’ costs of some buy-now-pay-later (BNPL) services and the recent crash in the value of several major cryptocurrencies that investment comes with a financial risk.
The knee-jerk response is to introduce stringent regulation, but clamping down too hard and too quickly comes with the risk of stifling innovation. We are still in the early stages of crypto and fintechs have just started to unlock the potential that it brings. There is much more to crypto than mere Bitcoin trading, and the technology that underpins it has the capacity to solve global challenges.
In the same way that the launch of 4G connectivity gave rise to the likes of Uber, Netflix and Spotify, crypto is a launchpad for the next generation of financial and digital services to take off from. We must ensure our regulatory regime doesn’t limit the UK’s ability to create its next biggest export.
The UK is already a fintech leader in crypto, open banking, embedded finance and much more. Finding that middle ground on regulation is what will continue to propel the industry forward.