The Ethereum development studio ConsenSys has been in business for a long time, and the company is advocating for the UK government to regulate applications rather than blockchain systems directly. The advice was issued by the company in response to an investigation into decentralised finance (DeFi) and crypto activity that was conducted in the UK.
ConsenSys advocated a more tailored approach to the regulation of public-facing blockchain apps in a letter that was published on Tuesday. The letter was meant to address any potential hazards. This strategy would function in a manner comparable to how the Web2 internet is governed. The company claimed that direct regulation of particular activities and services may take place rather than the imposition of artificial constraints on the blockchain technology itself. “It should be, and is more practically regulated if, those products or services that pose risks are regulated, not the purpose-agnostic open source code,” ConsenSys stated. “It is more practical to regulate those products or services that pose risks.”
According to the company based in Brooklyn, it is critical to pay attention to the level of control that various individuals or groups have over the applications that make use of DeFi. It is potentially dangerous if unauthorised parties are able to access private keys or tamper with smart contracts. These concerns should be addressed via regulations, but at the same time, room should be left for innovation and eventual decentralisation. ConsenSys further stated that ensuring the data integrity off-chain is a difficulty that should be taken into consideration while formulating legislation.
External data from the physical world or data contributed through oracles does not have the same level of assurance as data stored on the blockchain, which can be validated. Other notable members of the cryptocurrency ecosystem, such as a16z, Polygon Labs, Circle, and Binance, have already provided their feedback to the UK Treasury, which has already received a number of these comments. The government will evaluate the comments that were submitted and will make use of them when formulating its regulatory response. In the event that they choose to proceed, they will conduct additional consultations on certain regulations in conjunction with the relevant authorities in the UK. An interview conducted in April with Andrew Griffith, a financial secretary for the UK Treasury, revealed that he anticipated crypto laws to be finalised within the next year or so.
News on SNBC13.com
