Although cryptocurrencies have been around for some time now, there are still a lot of unknowns when it comes to their usage. Given that the regulations regarding crypto usage and payments are different from country to country, it is very easy for an individual to get confused.
This is why anyone who owns crypto or is planning on buying these currencies needs to be well-informed of the regulations. The UK has been announcing the regulation of crypto usage in the country and now any business needs to comply with the law in order to accept cryptocurrencies.
Most affected businesses
One of the most influenced businesses in the UK by crypto regulations is casinos. The gambling business is thriving in the UK and many sites are open to accepting crypto transactions: however, this is not allowed at UK-licenced casinos yet. Despite this, there are casinos licensed elsewhere that allow crypto payments. All of the most popular crypto casinos in the UK accept Bitcoin as currency, according to Andrew O’Malley. The industry has been booming since 2011 so a lot of sites have developed and perfected their crypto handling over time which also contributed to the popularity and safety of playing at crypto sites.
Similarly, there are a growing number of retailers accepting Bitcoin and other crypto. If you were to buy some luxurious jewellery or watches at C W Sellors or W Hamond, you should be able to pay using cryptocurrencies. Girl Meets Dress accepts Bitcoin as payment, the same goes for My Pashmina, PrivateFly and Bitfash. Express VPN, Nord VPN, Mullvad, and several other VPN companies in the UK are also known to accept Bitcoin as payment, as well as some other cryptocurrencies.
How does crypto fit into the law?
There are several aspects to consider when talking about the legal perspective of using cryptocurrencies as payment. First of all, there is the FCA, the Financial Conduct Authority, which deals with overseeing all crypto-related activities and regulating them. It also ensures compliance with anti-money laundering (AML) and counter-terrorist financing (CTF) laws and regulations. Moreover, any business that accepts crypto payments needs to comply with Know-Your-Customer (KYC) regulations. These regulations imply that they must check if any transaction seems suspicious, monitor the process and report if anything potentially illegal happens. Registration and licensing is a process that any crypto business operating in the UK needs to go through. This is merely a guarantee for users that a crypto business is legit, so it provides protection for the consumers and gives them confidence to use them.
There is also the matter of taxation to which guidance has been provided by HM Revenue and Customs (HMRC). Essentially, all crypto assets are subject to capital gains tax (CGT) and income tax.
What is the current situation?
In October 2023, the UK government finally issued the laws and regulations regarding crypto payments. This has been a long time coming as it was talked about a lot in previous years. So, what happens now? Cryptocurrencies are not regulated investments. However, the FCA does have authority over Money Laundering, Terrorist Financing, and Transfer of Funds regulations. This gives the FCA the right to oblige all businesses who wish to use crypto payments, to register with FCA. This, of course, allows the FCA to reject anyone they think is unworthy of accepting crypto, and, unfortunately, it does happen from time to time without a proper explanation. Hopefully, the laws and regulations will soon change for the better, especially for businesses out there that are trying their best and aiming to please their customers.
Other ways to use cryptocurrency
Some very famous stores do not accept direct crypto payments. However, they do accept gift cards bought using crypto. Such companies are Starbucks, Amazon, Microsoft, and many other insanely large brands. This is why it is safe to say that the new laws that regulate crypto payments in the UK will affect many people greatly.
How to know if the store complies with the new law?
Since the laws and regulations for crypto payments are still quite new, it is completely understandable that many people would be uncertain of which stores are now legit when it comes to accepting cryptocurrencies as payments. Luckily, there is a quick and easy way to check that. If you just go to the official website of the Financial Conduct Authority (FCA) and type in the name of the business you are interested in, it will show you whether or not the business is in compliance with the latest laws and regulations. This is also a must-see for each business that is looking into opening up to crypto payments or that already accepts them, but needs to comply with the new regulations.