Rishi Sunak launches NFT issued by Royal Mint to make UK ‘global cryptoasset hub’ | Science and technology news
Chancellor Rishi Sunak will launch a non-fungible token (NFT) – a type of cryptocurrency asset – via the Royal Mint to make the UK a “global cryptoasset hub”.
The government plans to introduce a series of measures for the notoriously unregulated cryptocurrency sector, which features incredibly volatile currencies like bitcoin.
It starts with the simpler end of this world with so-called “stablecoins” – cryptocurrencies whose values are more tied to existing traditional currencies (pounds, euros, etc.) than to the vagaries of the digital market.
The recognition of “stablecoins” should pave the way for their use as a recognized means of payment.
READ ALSO: NFT Scammers Make Millions From Wash Dealing, New Study Finds
What are NFTs?
NFTs are proof of ownership attached to a blockchain. Their proponents claim they are a unique asset class, while critics say the token is fundamentally worthless and bad for the climate.
Despite this debate, more than $44 billion (£32 billion) worth of cryptocurrencies were sent to NFT-related smart contracts last year, up from just $106 million (£78 million) in 2020, according to a new one Chainalysis report.
Chainalysis, which offers a blockchain data platform for law enforcement agencies and other organizations, has released a study identifying the extent of laundering to artificially boost the value of NFTs.
Wash trading is a market manipulation tactic that creates the impression that a financial instrument is more in demand than it actually is by trading it at increasingly higher prices between accounts operated by the same actor.
Read more about NFTs in our explainer here.
What does the chancellor want?
Mr Sunak will be working on an NFT with the Royal Mint “this summer”.
The Treasury plans to “ensure that the UK financial services sector remains state-of-the-art, attracts investment and jobs and expands consumer choice”.
This will be achieved in part by “improving the competitiveness of the UK tax regime to encourage further development of the cryptoasset market.”
Mr Sunak said: “It is my aim to make the UK a global hub for cryptoasset technology and the actions we have outlined today will help companies invest, innovate and scale in this country.
“We want to see the businesses of tomorrow – and the jobs they create – here in the UK and through effective regulation we can give them the confidence they need to think and invest for the long term.
“This is part of our plan to ensure the UK financial services industry is always at the forefront of technology and innovation.”
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It follows another move by the government into the cryptocurrency space in El Salvador, where the national system supports bitcoin as legal tender crashed on launch day.
And in the US, they are mayors of New York City and Miami involved in an argument on who can make their cities the most crypto-friendly, despite criticism that the financial tools encourage speculation rather than production.
In the UK, the Treasury said it would “proactively explore the potentially transformative benefits of Distributed Ledger Technology (DLT) in UK financial markets, allowing data to be synchronized and shared in a decentralized way for potentially greater efficiency, transparency and resilience reach”. .
The government has also pledged to introduce new legislation creating a “sandbox” for financial markets infrastructure that will “allow firms to experiment and innovate in the delivery of infrastructure services that support markets, particularly by allowing DLT to be tested.” .