The Treasury is finalising plans for a package of sweeping rules to regulate the cryptocurrency industry, including limits on foreign companies selling into the UK, provisions for how to deal with the collapse of companies and restrictions on the advertising of products. Ministers will shortly launch a consultation on the new regulatory regime, after the implosion of FTX injected fresh urgency into the government’s promise to impose order on finance’s “wild west”. Prime Minister Rishi Sunak said in April, while still chancellor, that “effective regulation” would help make Britain a global hub for cryptoasset technology and would encourage “the businesses of tomorrow to invest, innovate and scale up on UK shores”. The Financial Conduct Authority this year began inspecting the money-laundering controls of UK-based crypto companies, but it lacks broader powers to protect consumers in areas such as mis-selling, false advertising, fraud and mismanagement. The new powers will enable the FCA to oversee crypto more broadly, including monitoring how companies operate and advertise their products, three people familiar with the Treasury’s thinking said. They added there would be restrictions on selling into the UK market from overseas and that the proposals would set out how crypto companies could be wound down.
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