According to research conducted by the Internet agency Digital Catapult, the UK's opaque regulation of the digital technology sector has become one of the biggest problems for the country's blockchain companies.
Regulatory issues include the European Union's General Data Protection Regulation (GDPR). As GDPR unifies Europe's regulatory landscape regarding the use and storage of personal data, the legislation has become a thorny issue for blockchain companies since data storage is not limited to any one specific geographic location.
This legislation poses challenges for companies using public blockchains, which are open to everyone, regardless of location, in which complete copies of databases are replicated across all nodes participating in the network, making it impossible to selectively restrict data use.
Additionally, The GDPR allows citizens to delete their personal data at any time, which is contrary to the nature of public blockchains, where data remains unchanged once deposited.
Another cause of concern has been the regulatory uncertainty associated with raising funds through ICOs.
The report notes that in April this year, the UK Financial Conduct Authority announced its intention to regulate ICOs, but no clarification has yet been published on this matter. This is hampering plans that some ICO projects may have had:
This issue has been repeatedly raised by companies who are confused about whether they can conduct an ICO in the UK or allow UK citizens to participate in it, given the regulatory uncertainty.
Regulatory issues have also impacted the relationship between blockchain companies and traditional financial institutions. In a survey conducted among 264 companies, 54% of companies indicated that they had to face obstacles in opening a bank account with firms that had difficulty servicing cryptocurrency companies.
The study found that firms that hold digital assets find it difficult to open a bank account, despite investors taking all necessary anti-money laundering measures and complying with KYC procedures.
According to ccn.comС
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