Treasury Select Committee Tells UK Government: Treat Crypto Like Gambling
The Treasury Select Committee advises regulating cryptocurrency trading as gambling, denying it classification as a legitimate industry in financial services. This comes just over a year after the UK Government unveiled plans to invest in the development of the crypto market, sparking discussion about its position in a thriving global economy. The MPs believe that crypto has no intrinsic value and serves little social purpose, which makes it akin to gambling. The controversial move could have major ramifications for the UK, including stifling innovation in the sector and impeding taxpayer access to information about crypto investments.
Crypto Assets Lacks Fundamental Value and Purpose
The recommendation follows their report on crypto assets, released in September 2018, which suggested regulatory bodies aim to protect consumers and prevent money laundering, but until now, avoided outright classification of crypto products. Those in favour of crypto argue that the asset is comparable to an equity. However, despite the market’s remarkable success, many sceptics outside of the industry remain critical of the perceived lack of real value found in these assets.
UK at Crossroads as Crypto Market Grows and Poses New Challenges
As Chair of the Committee Harriet Baldwin argues, the sector is volatile and lacks any real regulation. Similarly, given the challenge of determining their net value, it is difficult to measure how such crypto assets will be taxed. The UK Government is now at a crossroads, deciding whether to treat the crypto market as a valuable resource or a speculative bubble. This contrasts starkly with other nations, such as Malta and Switzerland, who are opening their doors to crypto investment with open arms.
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