Seven cryptocurrency companies have set up the UK’s first crypto trade association in a bid to inject more legitimacy and transparency into the sector while authorities weigh up a potential clamp-down, The Telegraph reported.
The group — which includes Coinbase, eToro, CryptoCompare, CEX.IO, BlockEx, CoinShares, and CommerceBlock, as noted on the official website of the organization — announced that it had formed CryptoUK “to improve industry standards and engage policymakers”. Zeeshan Feroz, CEO of Coinbase UK, commented: “The fundamentals are engaging as a single industry with the government. Regulation is imminent and that’s a good thing.”
CryptoUK intends to work with the UK government to follow a code of conduct that will help prevent money laundering and other illegal activities involving Bitcoin and other cryptocurrencies, as well as better protect customers. However, the group will not deal with regulating Initial Coin Offerings (ICOs), an area of the crypto industry that has received criticism from regulatory bodies globally.
CryptoUK chairman and managing director of eToro Iqbal Gandham, stated that the new self-regulating body is aiming "to promote best practice and to work with government and regulators," adding that the company can become “the blueprint for what a future regulatory framework will look like.”
“The Code of Conduct is at the heart of everything we do. It is not finished. It will be improved and refined, in collaboration with industry, policy makers and others. We hope it can form the blueprint for what a future regulatory framework will look like,” Iqbal V Gandham, chair of CryptoUK, said in a statement.
On Monday, three EU regulators — the European Securities and Markets Authority, the European Banking Authority and the European Insurance and Occupational Pensions Authority — warned investors that there was a “high risk” that they could lose all their money on virtual currencies. The trio highlighted “clear signs of a pricing bubble” as well as a lack of consumer protections, price transparency and options to exit the market.
Last week, the head of the US Commodity Futures Trading Commission, Brian Quintenz, suggested that the cryptocurrency community should create its own regulatory system or self-regulatory organization (SRO) in order to avoid a “sterner government hand”.