CRYPTOCURRENCY CLEARINGS IN THE UK

CRYPTOCURRENCY CALCULATION IN GREAT BRITAIN

Is Cryptocurrency legal in UK?

In 2020 UK confirmed that crypto assets are property, it is not considered legal tender. According to the Bank of England, since cryptocurrencies lack classical definitional characteristics, they are not considered ‘money’ and do not pose a systemic risk to the stability of the banking ecosystem.

However, because the legal consequences, regulations, and status of crypto assets and currencies can change depending on their nature, type, and usage, the Financial Conduct Authority (FCA) and the Bank of England have issued a range of warnings and guidance about the use of cryptocurrency in the UK. In this warnings HMRC issued a brief on the tax treatment of cryptocurrencies in 2021, stating that their “unique identity” means they can’t be compared to conventional investments or payments, and that their “taxability” depends on the activities and parties involved.

In UK, cryptocurrency assets are divided into three types depending on their use cases:

• Exchange tokens, which are often called “cryptocurrencies”. This includes bitcoin, litecoin, ethereum, etc. They are not issued or backed by any central authority and are intended to be used as a medium of exchange. They are usually a decentralized tool for buying and selling goods and services without traditional intermediaries such as central banks or commercial banks.
• Tokens with properties of securities (security tokens). They are “certain investments” under the Financial Services and Markets Act 2000 or “financial instruments” under the EU’s Second Markets in Financial Instruments Directive (MiFID II). These tokens can give the right to a share of the profits or any other property rights.
• Utility tokens are used as access to specific platforms and provide the right to receive services or goods. Under certain conditions, these tokens can move into the category of electronic money.

Getting crypto license in UK

To enter local niche, you must get a UK cryptocurrency license from FCA. Main factor in cryptocurrency buying here is ban on crypto assets use to finance illegal deals. To open a crypto business, you should not just follow the AML/CFT rules, but also create and put into operation a mechanism for implementing the AML/CFT policy in your own company.

The regulator controls all parties involved in the purchase and sale of cryptocurrency in the state using the “Know Your Customer” (KYC) procedure. Cryptocurrency license makes it possible providing various functions of the company in an appropriate way.

Types of crypto authorizations in the UK:

• Cryptoasset exchange provider. It includes a company or one professional practitioner providing, in the course of doing commercial deals, one or a combination of following:
• exchange, organization or establishing arrangements for cryptoassets exchange for fiat money or vice versa;
• exchange, organization or establishing arrangements for exchange of one cryptoasset for another;
• management of equipment that uses automatic processes to exchange cryptoassets for fiat funds or vice versa.
• Custodian Wallet Providers Firm or a practitioner providing protection and administration services within the framework of its own work:
• keeping their clients’ cryptoassets;
• keeping their customers’ encrypted private keys for storing and transferring cryptocurrency, if required.

Requirements for obtaining a cryptocurrency permission in the UK

• Organization must be registered in the UK.
• Enterprise must own an office on the territory of the state.
• The person receiving the license must maintain in the place of business all records in relation to transactions that have been made by the licensee.
• The applicant must hire a director-resident and an anti-money laundering officer. It is imperative for the candidate to verify that directors have needed experience to manage the business, taking into account the educational qualifications and professional certification of persons appointed to senior positions.
• No requirement for the min authorized capital amount.

UK Cryptocurrency Lawyer

Services of UK crypto lawyer includes:

• Legal use of cryptocurrency
• Legalization of income received from operations with crypto and investments in cryptocurrencies
• Mining Bitcoin and Ethereum
• Consulting on IEO
• Taxation of withdrawal of assets in fiat money
• Legal support of ICO and IEO projects
• Structuring of blockchain companies
• Assistance to crypto investors
• Assistance of a lawyer on cryptocurrency investments
• Registration of ICO/IEO/DeFi and Mining

We provide full legal support for transactions with cryptocurrencies, conducting ICO / IEO, registration of DeFi and organization of cryptocurrency mining. Our lawyers are well-versed in all trends in the regulation of cryptocurrency in the world, including in the UK, and guarantee the most protected ways of its use.