UK lawmakers launch investigation into NFT regulations - 'there are fears the bubble could burst'

According to the DCMS committee, NFT regulation in the UK is "largely non-existent", with lawmakers planning to value assets before a review by the treasury department.

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Members of the UK's Digital, Culture, Media and Sport Committee have launched an inquiry to hear from the public about the potential benefits and risks of non-fungible tokens, or NFTs, and blockchain on the country's economy.

In a Nov. 4 announcement, the DCMS committee said its investigation was linked to the sudden growth of the NFT market, responding to concerns that the assets were overvalued and at risk of busting. According to the committee, NFT regulation in the UK is "largely non-existent", with the DCMS planning to value assets before review by the Treasury Department.

What are the risks and benefits of NFTs and the wider blockchain? We want to examine whether NFT investors, especially vulnerable speculators, are endangered by the market and whether there is a need for regulation. For more details, see https://t.co/C93XGBV7Ab pic.twitter.com/dvMTSwPYv1

— Committee on Digital, Culture, Media and Sport (@CommonsDCMS) November 4, 2022

"NFTs have swept across the digital world so quickly that we haven't had time to stop and think," said Julian Knight, chairman of the committee. "Now that the market is turning wildly and there are fears that the bubble will burst, we need to understand the risks, benefits and regulatory requirements of this game-changing technology."

The legislator added:

"Our investigation will examine whether stronger regulation is needed to protect these consumers and the wider markets from volatile investments. This investigation will also help Parli...