UK changes crypto control regulations
UK changes crypto control regulations
As part of efforts to introduce strict regulations to control cryptocurrency activity, the United Kingdom is increasing oversight of transactions involving digital assets.
The government has published a bill that sets out the conditions under which law enforcement agencies can act to detect crime. In particular, they will have the right to freeze crypto assets without a conviction. These regulations will come into effect on April 26.
The Economic Crime and Corporate Transparency Act 2023 will be amended accordingly, significantly expanding the powers of the National Crime Agency.
As part of these changes, the agency will be able to seize or confiscate crypto assets from companies if they are suspected of being involved in illegal activities or money laundering. The document, published on February 29, states that the process will be greatly simplified by eliminating the need for complex legal approvals.
New powers for law enforcement agencies will allow them to freeze and seize the assets of companies from custody accounts or stock exchange accounts. The draft legislation confirms the UK's commitment to tackling cryptocurrency crime.
Key principles of the extended powers:
- Law enforcement will be able to freeze and seize crypto assets linked to illegal activity.
- The powers will cover assets in custodial wallets and on exchanges.
- In addition, the government is introducing stricter measures to regulate stablecoins and cryptocurrencies.
- The UK aims to create a safer and more regulated environment for cryptocurrencies.
- The law will take effect on April 26.
The process of asset seizure is not spelled out in the preliminary document. However, it is believed that the most common way to destroy crypto tokens is to burn them, i.e., take them out of circulation by transferring them to a burned wallet address.
The authors of the legislative amendments are confident that the introduced norms will strengthen control and thus increase investor confidence. This will not only add legitimacy to cryptocurrencies and Bitcoin, but also control the stability of the market in the long term.
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