Cryptocurrency is constantly developing and its usage around the world has increased exponentially. This has brought the need for regulations, although keeping up with the rules in different parts of the globe is not easy. Bitcoin is the most popular cryptocurrency and a great number of investors choose this digital asset to enrich their portfolios.
The UK has introduced its own bitcoin regulations which have evolved in the post-Brexit financial outlook. Let’s see what is the current situation with the bitcoin regulations in the UK and what are the future predictions around it.
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Bitcoin regulations in the UK
The main bodies currently dealing with cryptocurrency in the UK are the FCA and HMRC which have demonstrated a progressive viewpoint. Bitcoin is recognized by the HMRC as a digital asset, subject to income tax. Since bitcoin is a decentralized currency, independent from the government, its adoption has been long but the general perception is a growing one.
The FCA was granted powers to supervise businesses involved in bitcoin back in 2020, in an attempt to prevent money laundering. Today, all businesses which deal with cryptocurrencies are required to be registered with the FCA (Financial Conduct Authority). Therefore, in the Uk, everyone can buy digital assets like Bitcoin, as long as these are not used for money laundering or terrorism.
Bitcoin ATMs are also legal in the United Kingdom, as long as they are licensed and regulated by the FCA. At the moment, the UK had over 250 bitcoin ATMs across the country.
Bitcoin ETFs (Exchange Traded Funds) are probably the safest and most compliant way among investors who want to build a diversified portfolio. Digital asset management companies like Jacobi provide a simple and effective way for professional and institutional investors to have access to Bitcoin offering fully regulated Bitcoin financial instruments with the highest level of insurance. Bitcoin ETFs aim to track the performance of Bitcoin and they are available on all traditional exchanges, which means they offer the security and the opportunity for a diversified and regulated portfolio without the implications of actually owning a Bitcoin.
The aim of the UK financial services sector is to remain at the cutting edge of technology, and The UK government has revealed its plans to make the country a leading global hub for cryptocurrencies, which will attract investment in digital assets.