The UK government has announced plans to launch its own non-fungible token (NFT) as part of its quest to become the “world leader” in cryptocurrencies. Finance Minister Rishi Sunak handed over the corresponding order to the Royal Mint. According to available data, the government NFT token will launch by the summer of this year.
The NFT token initiative is part of a broader government program that should lead the UK to global leadership in cryptocurrencies. There were also annoncement for further actions of the authorities aiming at tightening control of the digital asset market by regulatory authorities.
First of all, the authorities intend to include stablecoins in the UK payment system. There are also plans to hold consultations on the regulation of trade using other cryptocurrencies. At the same time, the legislative commission will consider the legal status of organizations providing financial services based on the blockchain (decentralized financial services, DeFi), as well as study the tax regime of decentralized finance and “staking”. At the same time, a working group on interaction with digital assets will be available, which will be led by British ministers and heads of regulators.
British government to issue NFTs in a bid for leadership in cryptocurrencies
Recall that NFT is a type of cryptographic tokens, each copy of which is unique and cannot get a replacement by another similar token. Also, NFT tokens usually serve as a kind of certificate of authenticity and uniqueness of a digital object. As for stablecoins, they are a class of cryptocurrencies that are stabilized by pegging to sovereign currencies or commodities.
Also, the U.K.’s NFT initiative is part of a broader effort by the government to “lead the way” in crypto; according to Glen. In addition, the minister announced a number of steps the U.K. will take to bring digital assets; under more regulatory scrutiny, including plans to:
- Bring stablecoins within the U.K.’s existing regulations on electronic payments.
- Consult on a “world-leading regime” for regulating trade in other cryptocurrencies, including bitcoin.
- Ask the Law Commission to consider the legal status of blockchain-based communities known as decentralized autonomous organizations, or DAOs.
- Examine the tax treatment of decentralized finance (DeFi) loans and “staking”; which gives crypto users the ability to earn interest on their savings.
- Establish a Cryptoasset Engagement Group that will be chaired by ministers and host members from U.K. regulators and crypto businesses.
- Explore the application of blockchain technology in issuing debt instruments.