UK FCA Proposes Lifting Ban on Crypto ETNs

The UK Financial Conduct Authority announced a proposal to lift its 2019 ban on cryptocurrency Exchange-Traded Notes for retail investors, aiming to provide wider market access.

The proposal signifies regulatory shifts, potentially boosting BTC and ETH trading volumes and aligning the UK with global crypto markets.

FCA’s Proposal to Integrate with US, EU Crypto Policies

The UK FCA aims to lift the ban on crypto ETNs, allowing retail access to Bitcoin and Ethereum-linked securities. This proposal aligns the UK with the US and EU crypto regimes.

David Geale, FCA Director, emphasized empowering investors to choose high-risk investments, while industry leaders like Bivu Das support lifting restrictions. This reflects shifting regulatory attitudes towards crypto maturity.

“We want to rebalance our approach to risk, and lifting the ban would allow people to make the choice on whether such a high-risk investment is right for them, given they could lose all their money.” — FCA Press Release

Industry Supports Potential Boost in BTC and ETH Liquidity

Industry reactions are positive, with leaders noting the FCA’s shift aligns with global trends. Retail access may improve BTC and ETH liquidity and trading volumes, boosting market dynamics.

The proposal could position the UK as a competitive crypto market. Investors may see enhanced opportunities to engage with emerging digital assets responsibly. Ian Allison on Twitter

Reversing 2019 Ban to Stimulate Retail Crypto Engagement

Past actions, such as the 2019 ban, limited retail ETN access, creating market discrepancies. By contrast, EU and US markets have allowed broader ETN distributions.

Analysts foresee increased trading activity and potential price impacts for BTC and ETH. Aligning with US strategies, this move could attract greater institutional interest.