UK parliament committee launches inquiry into risks and benefits of NFTs

A group within the UK's House of Commons announced an inquiry into the risks and benefits of non-fungible tokens, in a step towards the country's first NFT regulation.

Members of parliament will look into whether "NFT investors, especially vulnerable speculators, are put at risk by the market,” the Digital, Culture, Media & Sport Committee leading the operation said in a statement. 

The results of the investigation will likely conclude in regulation proposals and will be reviewed by the Treasury.

“This inquiry will also help Parliament understand the opportunities presented by an exciting new technology which could democratize how assets are bought and sold,” committee chair Julian Knight said in the release. 

Prime Minister Rishi Sunak proved a proponent of NFTs in his previous role as Chancellor of the Exchequer when he outlined plans to issue an NFT with the UK’s Royal Mint.

“NFT regulation in the UK is largely non-existent,” the parliament committee added. Crypto regulation in the UK is currently limited to anti-money laundering compliance required to register with the Financial Conduct Authority before a crypto firm can acquire a license.

Regulations such as the Financial Markets and Services Bill, which passed a vote in the House of Commons last week, is expected to beef up a more comprehensive framework for regulating crypto.