Cryptocurrency Regulation

Debate between Lisa Cameron and Alun Cairns

Tuesday 13th June 2023 Westminster Hall

[Dr Cameron]

I thank the hon. Member for his contribution. Yes, much of this will be led by the Treasury, and I imagine that regulation will be streamlined right across the United Kingdom. I am pleased to hear about developments in Northern Ireland; there have been many in Scotland, too. I spoke to Scotcoin not that long ago. This area has enthused and motivated people right across the United Kingdom, and it is important that we collaborate in order to realise its potential.

[Alun Cairns (Vale of Glamorgan) (Con)]

It is a privilege to serve under your chairmanship for the first time, Mrs Harris. I congratulate the hon. Lady on her work with the crypto and digital assets all-party parliamentary group and on its excellent report; it is a privilege to work with her. Some years ago, the UK became the world’s leading fintech centre because the regulatory environment was established with a clear direction from Government, which allowed businesses to invest and regulators to lean positively towards the sector’s development. Does she agree that if the positive record of the Government of that time is replicated with cryptocurrency, the UK will have a similar opportunity to be a leading nation in this sector, as well as in other financial technologies?

[Dr Cameron]

I thank the right hon. Member for his valuable contribution. I totally agree. I saw some research from PitchBook last month that suggested that since the EU produced its regulatory framework on markets in cryptoassets—MiCA—investment in the EU has increased substantially. With a regulatory pathway over the next 12 to 18 months at the maximum, the UK could harness a leadership position in this sector. That will be essential because of the digital revolution that is happening. The next generation is a digital generation already. This is the way that things are moving in the world, and the UK must be at the forefront. I am pleased that the Minister is harnessing his skills and endeavours to ensure that happens.

We heard that without comprehensive regulation there are considerable risks in the industry, particularly regarding consumer protection, economic crime and financial stability, which I will speak about later. While there are clearly legitimate concerns about the potential risk posed by cryptocurrency and digital assets, it is important to acknowledge a number of positive use cases that show the potential benefits of the new technology.

One such example is the use of cryptocurrency at the frontline of the conflict in Ukraine. Many may not know this, but following the Russian invasion, the Ukrainian Government appealed for cryptocurrency donations and received millions of dollars in cryptocurrency to support military and humanitarian efforts on the frontline. Ukraine’s Deputy Minister of Digital Transformation, Alex Bornyakov, has said that cryptocurrency has been “essential” to Ukraine’s response to the Russian invasion. I am delighted to welcome Minister Bornyakov and his team, who are in the Public Gallery. We are delighted to have them here today.

Our inquiry heard that the growth of the sector suggests that cryptocurrency is here to stay. The latest research by the Financial Conduct Authority shows that cryptocurrency ownership has almost doubled in the last year, with almost one in 10 people surveyed owning cryptocurrency in 2022. That highlights the need for proper, clear regulation to protect consumers and support the industry’s growth in a reasonable way. As countries around the world move quickly to develop regulatory frameworks, we feel that the UK must move within the next 12 to 18 months to harness the industry’s potential in order not to lose out to other jurisdictions.

Throughout our inquiry, we heard that there are potential barriers to the UK’s realising its vision, which we set out in the report. We heard that the process for cryptoasset businesses to enter the UK is very lengthy, with limited engagement at times, and that many businesses ultimately choose to invest outside the UK. While the Government have said that they are open for business and for companies in the sector to set up and scale up, we heard that that has not been the experience of many companies seeking to obtain licences to operate in the UK. They have seen very lengthy delays and, in many cases, had their applications rejected. That is fine, because we do not want a race to the bottom, but it often happens without a clear explanation and with limited communication throughout the process.

To date, only 41 firms have been approved to operate in the UK. Will the Minister say what more the Government can do to ensure that legitimate and responsible firms that want to set up and scale up here are able to do so? What steps are the Government taking to ensure that regulators have the resources they need to deliver on their responsibility to process applications?

FIFA World Cup 2022

Debate between Lisa Cameron and Alun Cairns

Thursday 20th October 2022 Westminster Hall

[Alun Cairns]

My right hon. Friend makes some extremely important points and I wholeheartedly agree with him. It goes back to comments I made earlier. I touched on what Nelson Mandela said—that sport can change the world—but I also highlighted, as my right hon. Friend underlined, the importance of bringing together cultures to better understand, influence and progress all stakeholders, so that that greater understanding and clarity move the agenda forward so that each nation respects, sees and supports human rights.

I pay tribute to my right hon. Friend the Member for Dumfriesshire, Clydesdale and Tweeddale (David Mundell) and I recognise the part he is playing. He rightly makes an important point about UK sport and UK football in particular. It is alarming that so few players have come out, which leading football commentators have commented on recently. It would be helpful to create momentum in the UK that would lead to the recognition and understanding of the fantastic diversity that people who actively participate in sport share and enjoy.

The APPG has taken these issues very seriously, as you would rightly expect, Mr Hollobone, and as my right hon. Friend, who is deputy chairman of the all-party parliamentary group, will recognise. We have organised and participated in a series of meetings and engagements with relevant and interested parties. I pay tribute to His Excellency Fahad bin Mohammed Al-Attiyah, Qatar’s ambassador to the United Kingdom, and his team for their open approach in seeking to answer the questions and concerns that we have raised. Whenever reports appear, the matters are raised with the ambassador and his political team—in a positive spirit, I underline. Our dialogue always continues so that we can better understand and influence each other’s thinking and background understanding, and develop a way forward.

In March, the all-party parliamentary group hosted a meeting in Parliament with His Excellency Hassan Al Thawadi—the secretary general of the supreme committee for delivery and legacy, which is responsible for bringing the World cup together—and the ambassador to the United Kingdom. Some 53 people attended. Members from all parties and both Houses, asked the most searching questions about some of the subjects that have been mentioned so far.

In May, the all-party parliamentary group on football, chaired by the hon. Member for Sheffield South East (Mr Betts), hosted a meeting with the independent body FIFA Ethics and Regulations Watch. The group’s report on human rights, including LGBTQ+ and workers’ rights, was interrogated similarly by colleagues. In June, the all-party parliamentary group on Qatar and the all-party parliamentary group for sport, modern slavery and human rights held a joint session with the UN- sponsored International Labour Organisation. Its evidence, gathered from 2017 up to the present, was scrutinised in detail, and changes and progress since 2017 on those subjects that I have underlined was recognised.

Each of those sessions offered different perspectives and evidence, and reassured colleagues on many of the issues that have been raised. The International Labour Organisation in particular, with its wider remit, commented that Qatar is a major reforming nation within the region. That should be recognised as we have a constructive dialogue about other changes that we would like to see in the region, and about how the region would seek to influence the UK in terms of its understanding. I am aware of further speculation in the press and media, and look to the Minister and the Qatar authorities to offer further information and clarity on some of the issues that have been raised. Hosting an event such as the World cup is a fantastic privilege and it brings with it global attention. With that come further demands from the public and commentators alike.

On specific operational matters, it is good to see that the authorities have given reassurances that anyone with a ticket will have the right to accommodation. That is welcome, but fans seek further information on costs and available options. Many will travel with organised tour groups, and some from neighbouring countries, which will ensure that this is a World cup for the region. Fans will travel on shuttle flights between those nations. That will provide an additional complexity, but is a great way of bringing the region together to celebrate the hosting of the games. Cultural diversity in the region is also a relevant factor on which we must advise visiting fans.

Any movement into Qatar will require a negative covid test. Because of movement within the region during the group stages in particular, that could be a significant challenge for the host nation, wherever fans are staying. Further clarity on that would be helpful, because the host nation will face additional pressures in ensuring that fans can travel easily and freely within the restrictions that covid demands.

Alcohol is an interesting dimension of any tournament, and the World cup is no different. It will be even more complicated in a nation where the consumption of alcohol is more restricted than in many other countries. We are advised that supporters will be encouraged to visit the fan zones if they wish to consume alcohol. The policing and management of that will require a delicate balance. This is a challenge for whichever nation hosts such a major tournament, but police authorities in the western world are obviously more experienced in managing this type of situation. Any information from the Minister on how that will be managed would be helpful. I will, with the rest of the all-party parliamentary group, continue my dialogue with the Qatari authorities to bring better understanding, but the Government will of course have a distinct role in communicating and sharing the UK’s experience of managing the challenges that come naturally with the organisation of any such large event.

[Dr Lisa Cameron (East Kilbride, Strathaven and Lesmahagow) (SNP)]

I refer the House to my entry in the Register of Members’ Financial Interests. I am also vice-chair of the all-party parliamentary group on Qatar. Does the right hon. Gentleman agree that it is important that, as well as alcohol, mental health issues are taken into consideration? When large groups of people travel anywhere, some of those individuals will have mental health issues, so the ability to understand and provide adequate support, should it be needed, is important. Sport is fantastic for both physical and mental well- being, but some individuals who have mental health difficulties will need support. There has for a long time been stigma around mental health issues in the UK, but I think understanding of them is progressing right across the world, including in Qatar, and we would like to know a bit more about the types of support that may be provided.