The U.K. Treasury Committee is launching a new inquiry into cryptocurrencies and distributed ledger technology, also known as blockchain, the committee announced on Thursday.
The committee will hold an inquiry into the risks and opportunities presented by the development of cryptocurrencies and the potential impact of blockchain technology on financial institutions, central banks, and the financial system overall.
The review will also examine the regulatory response to digital currencies, and how regulation can provide both adequate protection for consumers and businesses without stifling innovation.
“People are becoming increasingly aware of cryptocurrencies such as bitcoin, but they may not be aware that they are currently unregulated in the U.K., and that there is no protection for individual investors,” says Nicky Morgan, Treasury Committee chairwoman, in a statement.
The committee will look at the potential risks that cryptocurrencies could generate for consumers, businesses, and governments, including those relating to volatility, money laundering, and cybercrime, Morgan says.
It will also examine the potential benefits of cryptocurrencies and blockchain technology, and “to what extent they could disrupt the economy and replace traditional means of payment,” she adds.
CryptoUK, a newly formed trade group for the U.K. cryptocurrency industry, welcomed the inquiry.
“Our message to the Treasury Select Committee is that it is entirely possible to deliver a regulatory framework which ensures consumer protection and which enables crypto businesses to thrive,” the trade group said in a news release.