Speech by David Geale, executive director, Payments and Digital Finance and Payment Systems Regulator (PSR) managing director, at City & Financial Global.
On this day in 1922, Howard Carter became the first to enter the tomb of King Tutankhamun.He couldn’t see much, at first – he’d made a small hole in the door and had to peer through it using a torch. But it was enough for him to see something.People were divided on what happened when Carter opened the door.Some saw history being brought to life. Others believed it unleashed a curse.It sometimes feels that, with cryptoassets and stablecoins, we are standing at the same type of door.We saw the first glint of what was to come in 1990 with the launch of eCash. It hinted at a something that would define an age – the Carter moment for digital money, if you will.Less than 20 years later, Bitcoin flung the door wide open as the first true cryptoasset.And, like the one to Tut’s tomb, the door has stayed open.Today, cryptoassets and stablecoins are moving towards being mainstream.Over 90% of people in the UK have heard about crypto, and roughly seven million currently own or have owned it at an average of just over £1,800.Again, we find ourselves with two distinct schools of thought: One that believes we’re on the precipice of something great. Some have even called Bitcoin 21st-century gold.And another that sees an inherent danger in cryptocurrency due to its high volatility (as we are seeing again this week), difficulty in determining value and security risks.It’s true that crypto is currently largely unregulated in the UK and carries high levels of risk.But we also know that crypto is a broad term that encompasses a number of applications and use cases. For example, many would contend that stablecoins could bolster UK growth and competitiveness.I’m no Howard Carter, but I think there is a way to keep the door open and ensure consumers remain safe – supported by balanced and appropriate regulation.We already supervise cryptoasset businesses for anti-money laundering, counter-terrorist financing and financial promotions.Now, we find ourselves at a crossroads as the government works to bring crypto into our perimeter.