A new government consultation into cryptoassets could pave the way for the growth of peer-to-peer crypto lending, one industry stakeholder has predicted.
The HM Treasury Cryptoasset and Stablecoin consultation was unveiled this morning (8 January), as part of the government’s broader regulatory approach to cryptoassets.
It seeks views on how the UK can ensure its regulatory framework is equipped to deal with new technologies, while supporting innovation and competition and mitigating risks to consumers.
Lee Birkett, founder and chief executive of P2P lending platform JustUs, said that following the consultation the Bank of England will submit proposals for a digital currency to the government, which would be huge for P2P.
He has predicted that it will become easier, safer, quicker and cheaper for consumers to use a centralised digital currency to invest in P2P.
Read more: What the crypto boom tells us about P2P
“Digital currency is very much on the agenda of all central banks around the world, it’s important for global trade and it’s a race of who’s going to get there first,” said Birkett.
“The British government are now acknowledging that crypto can be part of crowdfunding.
“The only things banks are serving at the moment is lending and if P2P can replace that, capital will flow out of banks into centralised digital currency.
“It’ll be a huge boost for P2P because it cuts out the banks and the money would be deployed directly to people, rather than in the banks.”
Birkett said that banks are currently focused mainly on the government-backed emergency loan schemes. When that stops, he said, they will serve no purpose and people will leave for the Bank of England’s centralised digital currency offerings.
“Why would they hold money in a bank not offering a service or paying interest?” he said.
“Every central bank in the world is getting ready for this, it’ll be the end of banks as we know them. That’s why there’s a flight for crypto.”