Terra is a decentralized financial payment network that rebuilds the traditional payment stack on the blockchain. Luna is the reserve currency of the Terra platform. It has three core functions: i) mine Terra transactions through staking, ii) ensure the price stability of Terra stablecoins and iii) provide incentives for the platform’s blockchain validators.
In this regard, the UK government is considering adjusting existing regulations to ensure that the FCA The possibility of regulating these forms of electronic money, as well as the possibility of creating new regulations to deal with these assets, although the latter would be a major challenge.
- UK Government calls for regulation of stablecoins.
- They cite concern after what happened with Earth y UST.
- Existing laws will be adjusted to ensure that the FCA can regulate electronic money.
Concerns about the use of stablecoins following the collapse of UST de Earth, the UK government today released a document warning of the need to regulate these assets and address a place where cryptocurrency can be sent to and from, in the form of a string of letters and numbers. them within the legal frameworks currently in place.
UK intends to regulate stablecoins
This is what the government of the United Kingdom indicated in the aforementioned document, which reads as follows:
“Since the initial commitment to regulate certain types of stable coins, events in the cryptoasset a cryptoasset is any digital asset that uses cryptographic technologies to maintain its operation as a currency or decentralized application. markets have further highlighted the need for appropriate regulation to help mitigate risks to consumer, market an area or arena, online or offline, in which commercial dealings are conducted. integrity and financial stability.”
Among the considerations set out above, the local government suggests making use of the regulations currently in place to ensure that the UK Financial Conduct Authority (FCA) have the ability to regulate e-money, digital digital technologies are these electronic tools that have the ability to generate, store or even process data. payments and whatever is necessary to protect consumers against insolvency on the part of issuers/partners.
In addition to the foregoing, it also suggests that the Bank of England receive regulatory oversight and advice in relation to any payment system which is “systemically important.”
“A payment system may qualify as systemic where deficiencies in its design or disruption in its operation may threaten the stability of the UK financial system or have significant consequences for businesses… or other interests.”
Shared need after the fall of Earth
What happened with Earth not only set alarm bells ringing for the UK, as several nations and a host of regulatory bodies also pointed to the need for regulations on these issues in their respective jurisdictions.
Perhaps the country that has been emphasizing this the most is the U.S., where Treasury Secretary Janet Yellen pointed out the event occurred with Earth y UST para que el país proceda a dar más celeridad a una regulación sobre las stablecoins.
Another important body that urged its members to work on appropriate regulations for these cases is theG7, which on May 20 presented a document where he stressed the need to address digital currencies legally, inviting member countries to maintain standards similar to those that would apply to the financial system.
Stablecoins in the UK
The call for the UK to address these issues comes amid legislative proposals that are underway to legalize cryptocurrencies locally, which would not be so closely associated with so-called stablecoins, coins that are not yet listed as a valid form of payment within the British nation.
Some analysts argue that it will be a challenge for legislators to come up with a specific regulation that applies to stablecoins, since the technological and inherent aspects of their operation make it difficult to exercise adequate control over their use, circulation and marketing.
- Terra and its CEO ordered to comply with SEC subpoena in the U.S.
- G7 urges regulation of cryptocurrencies in the face of recent Terra ‘turmoil’
- Treasury’s Janet Yellen signals UST collapse in latest call to regulate stablecoins
- “Developing in haste only increases the risk of making mistakes,” says Charles Hoskinson in the wake of what happened to Terra
Version by Angel Di Matteo / DiarioBitcoin
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