UK's Treasury Select Committee Launches Inquiry Into Crypto

The UK’s Treasury Select Committee, a cross-party team of members of parliament, has announced that it is initiating an inquiry into cryptocurrency and the distributed ledger technologies that crypto networks are built on.

Nicky Morgan, Chair of the Treasury Select Committee, told CityAM: “People are becoming increasingly aware of Cryptocurrencies Cryptocurrencies By using cryptography, virtual currencies, known as cryptocurrencies, are nearly counterfeit-proof digital currencies that are built on blockchain technology. Comprised of decentralized networks, blockchain technology is not overseen by a central authority.Therefore, cryptocurrencies function in a decentralized nature which theoretically makes them immune to government interference. The term, cryptocurrency derives from the origin of the encryption techniques that are employed to secure the netw By using cryptography, virtual currencies, known as cryptocurrencies, are nearly counterfeit-proof digital currencies that are built on blockchain technology. Comprised of decentralized networks, blockchain technology is not overseen by a central authority.Therefore, cryptocurrencies function in a decentralized nature which theoretically makes them immune to government interference. The term, cryptocurrency derives from the origin of the encryption techniques that are employed to secure the netw Read this Term such as bitcoin, but they may not be aware that they are currently unregulated in the UK, and that there is no protection for individual investors.”

The inquiry will examine the opportunities and risks associated with digital currencies for individuals, businesses, financial infrastructure, and government institutions, including the Bank of England.

Morgan added that the committee’s goal is not to stamp out the use of cryptocurrency and Blockchain Blockchain Blockchain comprises a digital network of blocks with a comprehensive ledger of transactions made in a cryptocurrency such as Bitcoin or other altcoins.One of the signature features of blockchain is that it is maintained across more than one computer. The ledger can be public or private (permissioned). In this sense, blockchain is immune to the manipulation of data, making it not only open but verifiable. Because a blockchain is stored across a network of computers, it is very difficult to tamp Blockchain comprises a digital network of blocks with a comprehensive ledger of transactions made in a cryptocurrency such as Bitcoin or other altcoins.One of the signature features of blockchain is that it is maintained across more than one computer. The ledger can be public or private (permissioned). In this sense, blockchain is immune to the manipulation of data, making it not only open but verifiable. Because a blockchain is stored across a network of computers, it is very difficult to tamp Read this Term entirely.

“Striking the right balance between regulating digital currencies to provide adequate protection for consumers and businesses, whilst not stifling innovation, is crucial,” Morgan said. “As part of the inquiry, we will explore how this can be achieved."

Crypto in the EU: No Big Decisions (Yet)

While no widespread action has been taken in the EU to regulate cryptocurrencies, lawmakers and other government officials in Europe have begun discussions about which direction the EU’s relationship with cryptocurrency should go.

Of course, opinions vary quite a bit from nation to nation. Some countries are eager to embrace crypto--Kaspar Korjus, the director of Estonia’s e-Residency program, has proposed a national cryptocurrency for the tiny country.

here's #estcoin update for you. and yes, Draghi didn't exactly kill it. #eResidency https://t.co/lxunYHENZs

— Kaspar Korjus (@kasparkorjus) December 19, 2017

Others have taken a more bearish attitude. Angela Merkel (Germany) and Emmanuel Macron (France) have united in their rather cautious attitude toward cryptocurrency--French Finance Minister Bruno Le Maire said that together, France and Germany will present regulatory proposals regarding cryptocurrency at the next G20 summit.

Their concern may not be without legitimate reason. For all the potential benefit that blockchain technology offers to the EU, Director of Europol Rob Wainwright said in mid-February that money laundering through cryptocurrency in the EU could be happening to the tune of £4 billion.

In a BBC report, Wainwright said that he believes that lawmakers "have to develop a better sense of responsibility around how they're running virtual currency."