The UK government is planning a massive crackdown on illicit crypto activities.
The United Kingdom’s Treasury and Home Office have revealed plans to revamp crypto regulations to fight criminal activities and establish a safe and favorable environment for crypto adoption and innovations.
The plan to step up crypto regulations is part of the government’s 2023-2026 economic crime program, which broadly aims to combat illegal activities in the country.
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Economic Crime Plan was built on the predecessor plan, introducing new strategies to achieve a system-wide response to illicit economic activities by enhancing collaboration between relevant bodies, including law enforcement, the private sector, and supervisory agencies.
The policy paper, released on March 30th, aims to identify elite economic criminals and strip them of their cash. The plan includes integrating the efforts of various law enforcement agencies to help identify and seize illegal cryptocurrency assets.
The policy paper also states that the country’s crypto regulator, Financial Conduct Authority (FCA), will seek to collaborate with international regulators to share information on the fight against crypto crimes. The government has suggested the move amid the prediction that malicious actors will shift their operations to less regulated jurisdictions.
Some of the action plans by the government include coordinating with other agencies to implement the Travel rule by the Financial Action Task Force (FATF), which aims to combat money laundering and terrorism finance by the fourth quarter of 2023.
When talking about the regulatory actions against illegal crypto activity, regulators noted:
The government will set out ambitious plans to protect consumers and grow the economy by robustly regulating crypto-asset activities – providing confidence and clarity to consumers and businesses alike.
Another bill in line is the Economic Crime and Corporate Transparency Bill, which the government aims to pass by the end of 2023. The plan also includes establishing an effective communication channel between the FCA and crypto firms to enhance the flow of information.
In other UK-related news, in February, the Bank of England and His Majesty's Treasury revealed plans to start working on building and testing CBDC prototypes in 2025.
