I refer the Honourable Member to the answer given in response to PQ4875.

My department will continue to monitor developments in the use of both financial and non-financial applications of blockchain technology and will work with other government departments and industry to ensure we maximise its potential to spur UK growth and innovation.

This Government is committed to maximising the benefits and minimising the risks of new technologies. The Government has committed to increasing public expenditure on R&D to £20 billion per annum by 2024/2025. This cash increase will support the growth of innovator hubs and continue to fund a range of R&D programmes which will help boost the potential of new technologies including blockchain.

My department will continue to monitor the development of distributed ledger technology to ensure we maximise its potential to spur UK growth and innovation.

The Government is committed to creating a regulatory environment in which firms can innovate, while maintaining financial stability and clear regulatory standards so that people can use new blockchain technologies both reliably and safely.

Cryptoasset markets, for example, continue to develop with increasing pace and complexity, which brings risk as well as opportunity. Risk-taking is a part of the innovation cycle, however ongoing turbulence in the cryptoasset markets has highlighted some of the implications for markets and investors. We think this reinforces the case for clear, effective, timely regulation. The Government is therefore proposing to bring a broad suite of new cryptoasset activities into the regulatory perimeter for financial services for the first time. This includes exchange activities, custody and lending.

HM Treasury launched a consultation on the Future Financial Services Regulatory Regime for Cryptoassets in February and published its response to stakeholder feedback and final proposals on 30 October. The consultation delivers on the Government’s commitment to bring forward proposals for regulating activities relating to the trading and investment of cryptoassets, such as Bitcoin.

The Government has already taken action to address risks to consumers and market integrity in cryptoasset markets. Cryptoassets were brought into scope of UK anti-money laundering legislation in 2020, and following the government’s legislation, the financial regulator has commenced enforcement for cryptoassets financial promotions, requiring them to be fair, clear and not misleading.

More broadly, my department will continue to monitor developments in the use of blockchain technology and will work with other government departments to identify where this could require the introduction of further regulation.

HM Land Registry’s (HMLR’s) Digital Street research and development programme carried out a successful research piece and prototype into Blockchain technologies in 2020 and a summary of the research work can be found here.

The Government strongly believes that there are significant opportunities from digitising HM Land Registry (HMLR) and making more information freely-available. HMLR is also committed to promoting digital innovation in the property market. In recent years, it has introduced digital tools relating to electronic signatures and a standard for digital identity solutions. HMLR is working collaboratively with stakeholders in the conveyancing sector and is considering a range of technologies to contribute to a truly digital, automated conveyancing process.

Government’s Roadmap to a Digital Future includes digital transformation in Government by “automating manual processes”. Almost 90% of HMLR’s applications are received via digital application routes and the majority of HMLR’s services are already automated. HMLR continues to increase automation to drive greater efficiency and deliver maximum value for the taxpayer, and to increase the proportion of end-to-end digital processes.