Countries taking the stance against cryptocurrencies is not new as it has always been a part of the cryptocurrencies’ hustle. The UK lawmakers are aiming to classify virtual trading products, i.e., NFT and fan tokens, with gambling prolonging this conflict further. The announcements come as cryptocurrencies are being promoted as misleading the youth of our generation. Hence, the calls to regulate the crypto-based models as an extension of the gambling industry.
Cryptocurrencies remain virtually untouched all around the globe by any of the regulatory bodies. Even in the UK, virtual currencies still remain unregulated. But different agencies have different approaches towards regulating virtual money. The Advertising Standards Authority, with only limited powers, focuses on curbing misconduct and decreasing fraudulent activities in cryptocurrency marketing. The Financial Conduct Authority, on the other hand, has been trying its best to bring the whole industry into its fist. However, the current laws allow the presence of FCA only when there is evidence of misconduct or embezzlement.
The west is witnessing cryptocurrencies becoming mainstream culture. Even sports teams are embracing cryptocurrencies to avoid losing their revenue due to increasing restrictions on gambling and sports betting. Read more here about the best online betting sites that use bitcoin. It led to the creation of what’s known as FTP or Fan Token Partnership. These tokens help the fans have a say in some aspects of the team. However, critics are not happy with teams monetizing such trivial matters as they believe it brings a financial barrier between the teams and fans. While Arsenal was reproved by ASA for their fan tokens, Manchester City had to cut off its ties with the cryptocurrency firm known as 3-key following irregularities.
As explained by the lawmakers, the concerns also extend towards new brokerage platforms, like Robinhood, as they tend to resonate with elements of gambling. The regulators have just learned about what NFT actually means. So it would take some more time for them to figure out ways to regulate them. Recently, the UK Gambling Commission has cautioned the fans about their involvement in fantasy sports and NFT sports trading platforms, particularly Sorare. Mainly because these platforms are unregulated, but it is also clear that the authorities are not sure whether they need a license.
The Treasury Spokesperson of the UK said that these measures are underway with the welfare of consumers in mind. They also emphasized the difference between decentralized financial investments and the digital products that can be considered gambling in their approach.