Earlier this week, the UK saw a significant update into the classification of cryptocurrencies, classing them as “property”. This update now creates “significant steps” to clear up the uncertainty surrounding crypto assets. Classifying crypto as property and not currency is important for both legal and tax purposes. Senior High Court Judge Sir Geoffrey Vos outlined that in the legal statement that crypto-assets “have all of the indicia of property” reported by The Times newspaper.
This development addresses arguably the biggest stumbling block that the entire crypto space. With this seen as a major step in regulatory approval, it clears the way for business to use blockchain technology. The statement continues to add that “novel or distinctive features possessed by some crypto-assets — intangibility, cryptographic authentication, use of a distributed transaction ledger, decentralisation, rule by consensus — do not disqualify them from being property”.
By classing crypto-assets as property, it makes it much easier for companies to implement smart-contracts, as seen with Santander using the Ethereum blockchain. This should very much be seen as positive news for the entire space. The statement crucially explains that this classification should “go a long way towards providing much-needed market confidence, legal certainty and predictability in areas that are of great importance to the technological and legal communities and to the global financial services industry“. Unquestionably a very welcomed statement by all those involved.
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