Crypto and NFTs could face UK regulation crackdown in 2022

British Members of Parliament (MPs) and campaigners are pushing ministers to adopt a stricter stance on the growing crypto industry.

Campaigns and MPs are urging the government to take a tougher stance on NFTs and cryptocurrencies in 2022, amid growing concerns that they could prove dangerous for vulnerable people.

“It is the Wild West, this grey area between highly leveraged financial investments on the one hand and these products which could quite easily and sensibly be considered gambling,” Conservative MP Richard Holden told iNews.

“There needs to be a clear differentiation there in order to protect people,” he added.

Matt Zarb-Cousin, a former aide to former Labour Party leader Jeremy Corbyn spoke against soccer clubs’ rising interest in fan tokens, saying: “It is one thing for football clubs to market gambling to fans, which could lead to people destroying their lives as a consequence, but I think it’s on another level, it’s even worse to be offering a way into cryptocurrency through the pretence of empowering them in effectively a completely unregulated area. There’s clearly massive issues that are being stored up.”

Fan tokens are a form of crypto that are tied to a club and gives holders access to a variety of fan-related membership perks. Fans of some of the world’s biggest soccer clubs have spent over $350 million on fan tokens — but they have proven to be controversial.

The UK’s rocky relationship with crypto

This isn’t the first time crypto has caused a stir in the UK. Last year, the Financial Conduct Authority (FCA) published five concerns about the industry.

The regulator also cracked down on Binance, with the FCA stating that it had a big issue with its lack of headquarters. Shortly after, the FCA announced that Binance was “not capable” of being regulated after its UK entity failed to provide basic information to the regulator.

During the past year, the Advertising Standards Authority (ASA) has spent the last 12 months going after Coinbase, eToro, and several other crypto companies for their advertising strategies.

The FCA said: “given the lack of regulatory protections and the highly speculative nature of crypto investment, we have consistently warned that people should be prepared to lose all their money.”