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The Treasury Committee is considering the case for regulating cryptocurrency

British politicians are launching an inquiry into cryptocurrency, amid fears about the absence of regulation in the industry.

The Treasury Committee has announced it will investigate the role of crypto currencies in the UK, and how they affect consumers, businesses and government.

The cross-party group of MPs will also scrutinise the regulatory response of the government, FCA and Bank of England, and assess “how regulation could be balanced to provide adequate protection […] without stifling innovation”.

Nicky Morgan, the chair of the committee, warned that people are becoming increasingly aware of crypto currencies, “but they may not be aware that they are currently unregulated in the UK, and that there is no protection for individual investors”.

Morgan added that the committee will also examine the potential benefits of crypto currencies and digital ledgers: “The distributed ledger technology that supports digital currencies is said to have significant transformative potential, not least within the financial services sector.

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