The Treasury, Bank of England and Financial Conduct Authority have joined forces to launch a cryptoassets task force, as part of the government’s first fintech sector strategy.
The new unit will examine the potential benefits of cryptocurrencies and distributed ledgers, and search for ways to guard against the potential risks of the technologies.
The announcement comes just weeks after the Treasury Select Committee pledged to launch its own inquiry into the sector and Mark Carney said the assets were “failing”.
Philip Hammond, the chancellor, announced the task force at the Treasury’s second annual International Fintech Conference in Shadwell, East London.
“I am committed to helping the sector grow and flourish, and our ambitious Sector Strategy sets out how we will ensure the UK remains at the cutting edge of the digital revolution,” he told the audience.
“As part of that, a new task force will help the UK to manage the risks around cryptoassets, as well as harnessing the potential benefits of the underlying technology.”
Earlier this month, the governor of the Bank of England Mark Carney called for cryptocurrencies to be regulated to “to combat illicit activities, promote market integrity, and protect the safety and soundness of the financial system”.
While he suggested the assets could pose a risk to financial stability in the future, he did not call for a ban: “A better path would be to regulate elements of the crypto-asset ecosystem. […] The time has come to hold the crypto-asset ecosystem to the same standards as the rest of the financial system.”
In addition to the task force, the government’s fintech sector strategy announces the appointment of three fintech regional envoys and also includes “robo-regulation” pilot schemes to help new fintech firms and the financial services industry comply with regulations through software.