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<p>The government’s ambition is to make the UK a global hub for cryptoasset technology
and investment. In April, previous Ministers set out a number of reforms which will
see the regulation and aspects of tax treatment of cryptoassets evolve. The government
will also consult on its approach to regulating wider cryptoasset activities in the
coming weeks.</p><p> </p><p>Recent events in cryptoasset markets have highlighted
the importance of establishing regulation which supports safe innovation and protects
consumers and stability. As the cryptoasset market has developed rapidly, HMT and
the FCA have been working at pace to adapt existing regulation to the challenges –
and opportunities – posed by unique cryptoassets.</p><p> </p><p>For instance, to protect
consumers, the FCA has banned the sale of cryptoasset derivatives to retail consumers
and in January 2022 the government published a response to a consultation on a proposal
to bring certain cryptoassets into the scope of financial promotions regulation. The
forthcoming legislation on cryptoasset promotions, and supporting FCA rules, will
regulate in-scope cryptoasset financial promotions, requiring them to be fair, clear
and not misleading. This is aimed at improving consumers’ understanding of the risks
and benefits associated with cryptoasset purchases and ensuring that cryptoasset promotions
are held to the same standards as similar risk financial services products.</p><p>
</p><p>The government also draws attention to and restates the FCA’s warnings to consumers
that buyers of most cryptoassets should be prepared to lose all of the money they
invest.</p><p> </p><p>The government and the Cryptoassets Taskforce continue to closely
monitor the wider cryptoasset market and will stand ready to take further regulatory
action if required.</p>
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