Charles III is King of the United Kingdom, ushering in a new Carolean era for the country. The short time since this landmark change has seen Rishi Sunak become UK prime minister, who, in his previous post as Chancellor of the Exchequer, had been viewed as a tech and crypto evangelist of sorts.
While US-owned social media and crypto firms such as Twitter and FTX have seen upheaval in recent weeks, not much has happened in the Carolean era when it comes to UK tech. But this month has seen some interesting changes afoot in Britain for all things web3, decentralization and crypto.
The UK parliament for one has started an inquiry into nonfungible tokens (NFTs), while the committee for the Financial Services and Markets (FSM) bill is looking to regulate the Wild West of crypto advertising. The latter came about before cryptocurrency exchange FTX spectacularly crashed this week, with a lawsuit already in the works against the company’s founder and even the celebrity backers who advertised its wares.
This all makes for an interesting background for Rishi Sunak as he leads the UK further along the choppy waters on which it currently travels. The PM is well known for advocating Britcoin, a centrally run digital currency for the UK – not cryptographic money, but decentralized nonetheless. Sunak also asked the Royal Mint to create an NFT in April of this year to showcase Britain’s tech prowess; not much update exists for either product.
When speaking of Sunak, there is a tendency in the media to connect the PM with Silicon Valley and technology start-ups. But in reality, Sunak’s claim to tech fame outside of decentralized advocacy is that he married into the family of Narayana Murthy, founder of enterprise giant Infosys.
Infosys has minor crypto connections; in 2017, the firm joined the Enterprise Ethereum Alliance alongside Deloitte and others. Its consulting arm meanwhile has partnered with web3 brand Polygon to further legitimize NFTs and decentralized finance in the eyes of enterprise.
According to Kieran Marriott, a member of BCS, The Chartered Institute for IT, and a QA engineer, it’s wouldn’t be a surprise if Sunak shakes off his earlier crypto cheerleading now that he’s PM.
“His previous involvement with the Royal Mint creating an NFT might suggest an acceleration in the development of the UK being a crypto space, assuming that he still holds these values,” says Marriott. “However, with other issues for the UK government to tackle, as well as a mixed public sentiment towards cryptoassets, these ideas may be shelved to focus on current market conditions.”
The UK’s Carolean era, then, may be one where the nation shakes off the blue sky thinking of politicians and business in a post-Brexit landscape. Everything may have seemed possible once the UK left the EU, including crypto. Now the focus is once again on tightening belts in the face of gray sky recession.
Sunak may also want to avoid being tarnished by the recent failures of crypto firms such as FTX and Terraform Labs. Epic fails like those are why the UK government is now probing into crypto and NFT technology.
Marriott though thinks the concept of Britcoin may endure, especially as it’ll likely be a fiat-backed digital currency, opposed to a crypto one of the sort peddled by the sort of dodgy businesses currently making headlines.
“Advertising regulations may currently be more likely to affect bad actors in the cryptocurrency space who seek to mislead customers into believing that they are purchasing a guaranteed money-making investment.
“In my opinion a potential ‘Britcoin’ would likely take the form of a stablecoin, meaning that it’s value is pegged to a traditional fiat currency, in this case the pound. In theory the value should stay the same, but the potential for a bug to be exploited in the smart contract or the reserve currency being insufficient to match the peg could always affect this.”
Tech consultancies of the likes of Infosys Consulting, Accenture and the Big 4 meanwhile – which have been dipping into web3 evangelicalism with the same fervor as promoting the metaverse – may not have much to worry about when it comes to further governmental scrutiny.
“Since it is still early days for cryptocurrency advertising regulation, I personally think the key areas of focus will be disclosing that your investment can rise or fall in value and that cryptoassets are unregulated – they cannot be recovered if they are lost,” says Marriott.
“For tech consultancies the same care would need to be taken as you would with traditional investments. In my opinion I don’t see much change here; wording will be similar to some bank accounts cautioning that cryptoassets are not FCA approved.”
As enterprise knows, if consultancies keep evangelizing with little restraint, then hyped technologies can, with varying degrees of success, break through the ranks and become reality.
The UK therefore may still become a crypto country against the Carolean era’s uncertain backdrop, even if Rishi Sunak stops being a crypto bro, and firms like FTX keep going bust.