The UK’s Law Commission has recently established that the UK should create a new category of private property law for digital assets such as crypto and NFTs. This follows the European Union’s attempts to regulate the crypto asset sector through a Europe-wide regulation called MiCA.
What would these new laws entail?
In addition to defining NFTs and crypto as personal property, proposed legal reforms would allow those affected by crypto scams to seek legal action. This crypto-friendly reform is in line with the UK’s ambition to become a global crypto hub. It is important to note that these reforms only apply to Britain. This is because Northern Ireland and Scotland have their own legal commissions.
In April, Rishi Sunak – then the UK finance minister and now in the running to become the next Prime Minister – asked the Law Commission to review the UK’s current crypto laws. This was done to accommodate digital assets such as NFTs and crypto.
Last week, financial regulators proposed that Parliament recognise stablecoins as a legal means of payment. In addition, the consultation paper discusses how current laws cannot be applied to digital assets. According to this paper, digital assets have “many different features” and “unique qualities” that distinguish them from traditional assets.
The UK’s position as a cryptocurrency hub
Undoubtedly, the UK is rapidly becoming a crypto and NFT hub. Nevertheless, the FCA, which regulates crypto in the UK, has not managed to create a fully regulated landscape. Therefore, according to the Law Commissioner for Commercial and Common Law, Sarah Green, a robust regulatory framework must be established to support the UK’s crypto industry.