Crypto Asset Technology

Lord McNicol of West Kilbride Excerpts

Thursday 21st July 2022 Lords Chamber

[Baroness Penn (Con)]

I absolutely agree with the noble Lord about the importance of ensuring that crypto assets cannot be used for money laundering or, for example, for the avoidance of sanctions when it comes to Russia and its invasion of Ukraine. That is why we have brought it within our anti-money laundering regime. We have extended the scope of those rules. The SI that we were debating this week is part of the action to do so. We will also continue to work internationally on the regulation of crypto assets, because that action is needed to ensure that other jurisdictions cannot become areas where people use crypto assets for illicit finance.

[Lord McNicol of West Kilbride (Lab)]

My Lords, as we have heard from across the House, regulation is the key to this. How stable does the Minister think that stablecoins are? Some Governments are looking at introducing a central bank digital coin. Do Her Majesty’s Government have any plans to introduce a CBDC?

[Baroness Penn (Con)]

My understanding is that the Bank of England is looking at the question of introducing a CBDC. In terms of stablecoins, the name derives from them being linked to other assets, rather than because of any inherent stability. We are seeking to regulate them because of that link to other assets. They may become a form of payment within the wider system, which would raise questions of financial stability and is why we have prioritised regulation in that area.