MPs are falling silent over potential of cryptocurrency
The UK government’s ambitions to become a global hub for the cryptocurrency industry aren’t shared by MPs, research from the communications, advocacy and research agency SEC Newgate has found.
The agency’s quarterly index of MPs’ attitudes towards the cryptocurrency industry (for 1 March to 1 May 2022) found that debate around the sector had slumped in the House of Commons and on social media.
Only around 14 MPs out of the 650 who sit in the House of Commons mentioned cryptocurrency-related terms, including ‘blockchain’, ‘Bitcoin’, ‘Ethereum’, ‘crypto’ and ‘cryptocurrency’, in Parliament or on social media.
The figure was down from 22 in the December to February period, and further down from SEC Newgate’s first report from March 2021 which found more than 40 Members of Parliament had openly referred to cryptocurrency.
The figures will no doubt disappoint those in the Treasury and the cryptocurrency industry who want MPs to take the sector more seriously.
The research did find that the most vocal MP on the subject, former Health Secretary Matt Hancock, has been positive about the industry. He recently told Crypto AM that it was his ‘mission’ to make the UK love crypto.
Other movers and shakers in the regulatory debate include City minister John Glen, as well as Labour’s Chi Onwurah, a technologist who has previously warned that the government’s Online Safety Bill does not adequately encapsulate the developments of the blockchain industry.
Some of the contributions in the House of Commons came during the 7 March debate on the Economic Crime (Transparency and Enforcement) Bill, during which MPs including the Shadow Home Secretary Yvette Cooper and Conservative MP Damien Collins, expressed worries that cryptocurrencies could be used to avoid sanctions.
More positive sentiments over the period came from trade minister Penny Mordaunt, who held a meeting with the president of the Texas Blockchain Council, Lee Bratcher, in mid-April.
Separately, SNP MP Martin Docherty-Hughes noted that technology could help “play a part” in building trust and transparency in voting systems, ahead of meeting of the All-Parliamentary Group (APPG) on Blockchain. The group is not to be confused with the APPG on Crypto and Digital Assets, which was launched in January and is chaired by the SNP’s Dr Lisa Cameron.
Its vice-chairs include Docherty-Hughes, Conservative MP and member of the Treasury Select Committee Harriett Baldwin, non-affiliated peer Lord Taylor of Warwick, and Conservative MP and member of the Business Select Committee Alexander Stafford.
Across all platforms, Conservatives MPs mentioned cryptocurrency (and related terms) the most, with Labour and the SNP trailing. Though Liberal Democrat MPs have not recently spoken on the topic, the party’s Business Spokesperson Sarah Olney confirmed in 2021 that it was broadly supportive of the industry.
The research comes at a pivotal for the cryptocurrency industry. Boris Johnson’s government has stressed that “the UK is open for business and open for crypto businesses”, while financial regulator the FCA has run so-called ‘CryptoSprints’ with industry figures to help boost its knowledge on the sector as it seeks to regulate it.
The Treasury has also unveiled plans to recognise and regulate some stablecoins (which mimic and mirror the price of major fiat currencies like the US dollar and Euro), commission the Royal Mint to produce a non-fungible token (for summer 2022), and charge The Law Commission to investigate the legal status of Decentralised Autonomous Organisation (DAOs).
Understatedly, it has not all been positive noises from the UK’s institutions and regulators towards the crypto industry. Bank of England Governor Andrew Bailey used an April speech to warn that digital assets were the new “front line” in criminal scams.
G7 leaders have also called for swift regulations to be introduced on the cryptocurrency industry after the industry saw a crash in May.
Meanwhile, across the Atlantic, US Treasury Secretary Janet Yellen said it was “highly appropriate” for legislation around stablecoins to be published this year.
Ian Silvera, cryptocurrency and digital assets lead at SEC Newgate UK, said it was worrying that UK MPs still seem to be almost publicly silent on the cryptocurrency industry.
“London and Britain take great pride in being one of the world’s leading financial hubs and a champion of the fintech sector,” he said.
“However, rather than seeing blockchain technology as a post-Brexit dividend, the country could become a laggard and take its cues from other lawmakers if our own MPs, who sit at the heart of our democracy, aren’t further informed about the potential pros and cons of cryptocurrency.
“Education of policymakers remains a top priority for the crypto sector at this crucial time as global governments and regulators are evaluating their own approaches to crypto.
“Crypto has the power to transform traditional financial services and it is important that we help policymakers develop their understanding of the sector, the potential benefits of a well-regulated crypto sector, and the post-Brexit opportunities for the UK in terms of jobs, economy and innovation.”