UK Central Bank to Clamp Down on Crypto Money Laundering

The head of the U.K.'s central bank has said that the institution will step up its efforts to combat the use of cryptocurrencies in illegal financial activities.

According to a report by The Independent, Mark Carney, governor of Bank of England said he thinks more rigorous regulations should be applied to cryptocurrency exchanges in an effort to curb illicit use of cryptocurrencies in financial crimes, such as money laundering and terrorism financing.

"In my view, holding crypto-asset exchanges to the same rigorous standards as those that trade securities would address a major underlap in the regulatory approach," Carney said during a speech at the Scottish Economics Conference in Edinburgh on Friday.

Further, the central bank chief said he doesn't believe cryptocurrencies currently pose significant risks to the existing financial system. However, such risks may grow as retail adoption of bitcoin expands and traditional institutions lag behind on improvements to their systems.

Carney's comment comes soon after a warning from the country's top financial regulator on the risks of cryptocurrency investment.

As reported in December, Andrew Bailey, the chief of the Financial Conduct Authority, warned domestic investors that cryptocurrency assets like bitcoin are not regulated in the U.K. and, as such, any investment loss may not be protected.

Bank of England image via Shutterstock

The leader in blockchain news, CoinDesk is an independent media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. Have breaking news or a story tip to send to our journalists? Contact us at news@coindesk.com.