Bank of England (BoE) deputy governor for financial stability, Jon Cunliffe, reportedly put up a proposal for a set of regulations – same as conventional financial systems – to minimize crypto-related risks. 

Specifically, during his speech at a press conference, Cunliffe reportedly emphasized the crash of the Terra ecosystem, drawing a conclusion that cryptocurrencies that were not able to maintain their value will be about stress throughout crypto markets. 

He reportedly mentioned examples in the traditional finance sector, in which regulations provided a safe harbor for investors from unrecoverable financial damages when talking about his proposal for a crypto regulatory framework.

“For me, it underlines the fact that we need now to bring in the regulatory system that will manage those risks in the crypto world in the same way that we manage them in the conventional world.”

While taking into account crypto’s “real potential for use in the financial system,” Cunliffe also claimed that it is not necessary for crypto-centric regulations to stray too far away from that traditional finance. Nonetheless, the application process may need some adjustments, while acknowledging the underlying technology operating cryptocurrencies.

BoE Governor Andrew Bailey further highlighted the necessity of global agencies taking part in borderless or cross-border trading of cryptocurrencies, stating that “unbacked crypto” does not possess an intrinsic value, but can be more suitable recognized as an investment. 

On the other hand, the governor reportedly shared a belief that stablecoins will function better if selected as a medium of payment. 

“I think they (cryptocurrencies and stablecoins) need a different lens, and that’s what we’re doing in terms of how we approach it.”

Insights from a study carried out not a while ago with the participation of 5,916 citizens by Her Majesty’s Revenue and Customs (HMRC) reportedly suggested that an average crypto asset holder in Great Britain considers crypto to be a “fun investment.”