Fully compliant crypto companies should be placed on a ‘white list’ to help banks to determine which ones are safe to expose to their clients, says CryptoUK, the UK’s leading crypto trade organization.
As reported by CoinDesk, in a letter to regulators, CryptoUK says that circulating a list of safe firms is just one of a number of measures the government can take to prevent exchanges from being cut adrift from the financial system.
The suggestion is a response to increasing numbers of crypto companies being ‘de-banked’ due to financial institutions’ desire to protect their clients from potentially risky products.
The relationship between crypto and the banking industry is particularly turbulent at present, with prominent crypto banks Silvergate, Signature Bank, and Silicon Valley Bank either collapsing or being bailed out by the US government.
In the letter, sent on Tuesday, CryptoUK said: “We believe that government action is now warranted because banks are implementing blanket bans or restrictions instead of taking a risk-based and case-by-case approach.
“[Our members] believe there are a number of potential solutions that can be explored, including creating a ‘white list’ of platforms that have engaged with the UK’s regulatory perimeter.”
The letter also suggests that, if this or a similar approach isn’t taken, the UK risks torpedoing its ambitions of becoming an established ‘crypto asset hub.’
As detailed by CoinDesk, another letter from CryptoUK also called upon the Financial Conduct Authority and Payment Systems Regulator to find a solution to the de-banking problem.