Cryptocurrency
FCA Bans Crypto Derivatives for Retail Consumers in UK
FCA Bans Crypto Derivatives for Retail Consumers in UK: As reported at CoinDesk, “The Financial Conduct Authority (FCA) has published final rules banning the sale of derivatives and exchange-traded notes (ETNs) that reference certain types of crypto assets to retail consumers. The U.K. financial regulator said it considers these products to be ill-suited for retail consumers due […]
FCA Bans Crypto Derivatives for Retail Consumers in UK:
As reported at CoinDesk, “The Financial Conduct Authority (FCA) has published final rules banning the sale of derivatives and exchange-traded notes (ETNs) that reference certain types of crypto assets to retail consumers.
The U.K. financial regulator said it considers these products to be ill-suited for retail consumers due to the harm they pose, asserting they cannot be reliably valued by retail consumers because of the:
- Inherent nature of the underlying assets, which means they have no reliable basis for valuation
- Prevalence of market abuse and financial crime in the secondary market (e.g., cyber theft)
- Extreme volatility in crypto asset price movements
- Inadequate understanding of crypto assets by retail consumers
- Lack of legitimate investment need for retail consumers to invest in these products.