Thu. Jan 13th, 2022

Wednesday, December 1, 2021 at 07.00

Former Chancellor Philip Hammond said Britain needed to move forward quickly with digital assets to secure its post-Brexit advantage in financial services.

Lord Hammond, who recently joined cryptostart-up Copper, believes digital assets can give London a unique advantage over European competitors. In an interview with City AM, the former finance minister said he hopes lawmakers will support the use of new technology to trade digital assets and create a tokenized financial sector.

“I personally think the momentum is unstoppable now,” Hammond said. “We need to move quickly and efficiently to secure London’s position.”

“If we do not look closely, we will discover that some surprising people are ahead of us,” he warned, warning that European competitors see digital assets as an opportunity to overtake the UK as a hub for financial services in the world.

Hammond: ‘It’s going to happen’

Digital Asset Deposits Copper, which Hammond joined as a senior adviser last month, enables over 400 institutional investors, including banks, to handle and trade crypto. The company brings together worlds of traditional and decentralized financial business, a collision that Hammond sees as inevitable.

“Most institutions know that whether we like it or not, it’s going to happen,” Hammond said. “It’s not something anyone who runs a major financial services business can hide from.”

While Britain’s former chancellor does not himself invest in crypto, he is sold on the transformative potential of its underlying technology and believes that blockchain can support a future trading system.

Regulation

However, Hammond is concerned about Britain’s lack of regulatory clarity. According to the former chancellor, London’s regulatory society has “taken the eye off the ball on some recent technological developments” because of its focus on Brexit.

“If we are very honest about it, we have already allowed others to come before us. Regulators have been greatly distracted,” Hammond said.

In contrast, the EU has proposed draft schemes for digital assets to provide much-needed clarity for cryptocurrencies. Europe’s Markets in Crypto Assets (MiCA) are pushing for centralized monitoring of crypto markets and providing guidelines for consumer protection.

“They can not copy a London-sized financial center, which is why we still have the ball in our half of the pitch,” Hammond said. “But we have to move pretty fast to show that this technology is recognized and accepted by legislators and regulators in the UK.”

Digital lawyer

Hammond, who served as chancellor for three years under Theresa May and became a Life Peer in 2020, has been a longtime proponent of new financial technologies.

Alongside his advisory role at Copper, Hammond works as a consultant for challenging bank OakNorth, a role that recently got him into hot water at Parliament’s lobby watchdog to contact a finance minister on behalf of the company.

The government took no action on the committee’s reprimand, which added fuel to a Westminster dispute over whether political representatives should be allowed to take jobs outside of their parliamentary duties.

Hammond believes it is “beneficial to the system that we have people in Parliament with a wide range of experience,” but admitted that “there is always a balance to be found.”

Read more: Former Chancellor Hammond’s PE firm looks at government contractor Amey

By Victor

Leave a Reply

Your email address will not be published. Required fields are marked *