The EU has agreed a landmark law on cryptography, making it one of the only political institutions in the world to agree on substantive regulation of the technology, while Britain and the US continue to delay.

The Markets in Crypto Assets Act (MiCa), due to come into effect at the end of next year, is one of the world’s first major crypto-asset regulations.

Billed as an attempt to “bring order to the wild west of crypto-assets,” according to German lawmaker Stefan Berger, MiCa will require cryptocurrency companies to acquire a license and introduce customer guarantees to operate in the EU.

While regulators in the UK have sought to strengthen oversight of the cryptocurrency industry, a proper regulatory regime is not yet in place.

The UK’s investment managers’ trade body, the Investment Association (IA), has published a the report today calls for the Financial Conduct Authority (FCA) to set up a decentralized digital finance task force to support and regulate technological advances in finance.

“With the ever-accelerating pace of technological change, the investment management industry, regulators and policymakers must work together to drive innovation without delay,” said Chris Cummings, chief executive of the IA.

“More innovation will not only improve the overall competitiveness of the UK funds industry, but improve the value, efficiency and quality of the investment experience.”

There was some concern that if the UK fell too far behind, it would be forced to fall in line with regulatory systems established in other countries.

Hopes for British cryptography not ‘crushed’

This fear has been raised about technical regulation more broadly. Andrea Cascelli, chief executive of the Competition and Markets Authority (CMA), previously said the government’s delays in introducing technical regulation, which differs from the EU, would put the nation at risk turning into a “conduit” from Europe.

However, for some, the law with the EU on crypto regulation was agreed too hastily.

“Regulation is critical to making crypto adoption safer for consumers,” said Chirag Patel, CEO of digital wallets Paysafe.

“While I welcome the EU’s approach to establishing comprehensive regulation, I am also very supportive of the UK’s position at this time.”

Patel believes that given both the complexity and nascent nature of the crypto industry, governments should consider devoting more time to getting regulation right.

“There are serious risks associated with moving too quickly, given how complex the issues are, and rushing needed regulation could end up doing more harm to consumers than good,” Patel added.

The EU’s crypto law could also “go too far” and push crypto-asset firms into other jurisdictions, a potential advantage for the UK, one crypto lawyer said.

“Although it is clear that EUThe UK’s work on the subject is well advanced, this does not mean that the UK hopes to become a jurisdiction for cryptoasset companies are devastated, said Kathy Frye-Paul, crypto Regulatory expert at the law firm Taylor Wessing. “Time spent in exploration is rarely wasted and a pre-agreement on MiCA could give the UK the opportunity to gauge the industry’s views and take advantage of its agility to take swift action.”

Institutional adoption of cryptocurrencies in the UK was a project announced and supported by former Chancellor of the Exchequer Rishi Sunak.

In April, Sunak gave a speech in which he outlined a plan to turn Great Britain into a a global hub for cryptoassets. However, with Sunac resigning as chancellor earlier this week, it is unclear what will happen to the plan.

EU introduces landmark crypto law amid calls for UK to keep pace

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