The UK is shaping up to become a major hub for cryptocurrency enthusiasts as the region has taken an interest in supporting the emerging technology by creating a home for digital currency-based businesses.
Earlier this year, the region called for a thorough investigation into how cryptocurrencies will develop in the coming years and promised to work together with industry players to create regulations that protect users while still promoting growth.
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Now, the region is grappling with how to move forward on its bitcoin-friendly initiative after Accenture Plc (NYSE: ACN) urged UK policymakers to start regulating bitcoin wallets.
Money Laundering A Concern
In a document obtained by CoinDesk, Accenture consultants outlined the positives and negatives of bitcoin integration.
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Money laundering, Accenture claimed, is the largest risk associated with bitcoin. In order to combat that, the consulting firm recommended that the UK set up regulations that treat bitcoin wallets similarly to traditional bank accounts.
Strict Setup Requirements
Accenture said the UK may have to set up a centralized regulator that oversees the use of digital currency wallets. Wallets would require users to submit identification in order to be set up, thus eliminating some of the anonymity and keeping money launderers from using cryptocurrency.
Necessary To Involve Banks
While critics say that this type of intervention undermines the purpose of cryptocurrencies, others say it is the only way to move the industry forward into mainstream use.
Accenture predicted that without tougher government controls, traditional banks are unlikely to engage with bitcoin-based businesses that could stunt the industry's growth.
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