Recently, the British MPs making up the Treasury Committee attacked the cryptocurrency sector. They claim that investments in these assets should be considered gambling. Their speech testifies to a growing hostility against cryptocurrencies since 2022, a bloody year that has marked all players in the sector.
The Treasury Committee against Bitcoin and altcoins
While the European Union discussed tax rules relating to cryptocurrency transactions yesterday, the Treasury Committee says that investments in this market should be regulated as gambling.
The Treasury Committee is a group made up of 11 deputies from various political parties. Chosen by the House of Commons, the lower house of parliament in the UK, their main purpose is to review the actions of HM Treasurythe country’s Ministry of Economy and Finance.
According to committee members, cryptocurrencies are more like gambling than a financial service because they would cause financial losses while having no function beyond potential financial gain. Therefore, cryptocurrencies should be under gaming laws:
“We therefore strongly recommend that the government regulate retail and investment activities in cryptocurrencies as gambling rather than a financial service, in line with its stated principle of “same risk, same regulatory outcome.” »
Is this distinction legitimate? Before cryptocurrencies appeared in our everyday language, shares on the stock market were already decried by some because of their volatility and the financial risks they entailboth from the point of view of individuals and institutions.
Likewise, to say that cryptocurrencies have no function is to wipe the slate clean. Remember that blockchain technology is the result of 40 years of scientific research. Today, cryptocurrencies offer an alternative monetary system to that today dominated by banking and financial institutions.
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A fear of cryptocurrencies since the bear market of 2022
How to explain the reproving discourse claimed by the Treasury Committee? The main answer to this question is based on the fall in prices and the multiplication of bankruptcies during the year 2022.
Between November 2021 and July 2022, the cryptocurrency market halved its financial capitalization. Similarly, the collapse of the Terra (LUNA) ecosystem and the FTX group caused the loss of tens of billions of dollars with investors.
Today, the downfall of these behemoths is associated with criminal activity and their founders face legal action. However, the legislators of the committee focus only on these failures without taking into account Regulated players who are in favor of regulation combining innovation and investor security.
According to Harriett Baldwin, Chair of the Treasury Committee, the cryptocurrency sector remains a “Wild West” requiring strong regulation:
” The events of 2022 have highlighted the risks posed to consumers by the cryptocurrency industry, much of which remains a Wild West. »
According to the report of the Association for the Development of Digital Assets (Adan), 12% of Britons own cryptocurrency and 18% have owned it before. In this context, the government of Prime Minister Rishi Sunak wishes to create a specific regulatory framework in order to catch up with the United States and the European Union.
👉 According to the latest Adan report, 1 in 10 French people owns cryptocurrencies
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Published by Editions Larousse
Sources: Reuters, France 24
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Always enthusiastic about new technologies, I gradually moved closer to Web3-related activities during the year 2021. Over time, I wanted to add my stone to the building. It was then that I became an editor, with the aim of explaining cryptocurrency-related topics to as many people as possible.
Timothy Bourbotte
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