UK FCA to Lift Ban on Retail Crypto ETNs
- UK FCA proposes retail crypto ETN access lifting by 2025.
- FCA aims to enhance crypto competitiveness.
- Retail derivatives ban remains.
The UK Financial Conduct Authority plans to lift its ban on retail investment in crypto exchange-traded notes by 2025, marking a pivotal regulatory shift in London’s financial landscape.
This policy change aims to boost the UK’s crypto industry competitiveness, though retail investors remain limited to cETNs, with derivatives restrictions still in place.
The UK Financial Conduct Authority plans to lift the ban on retail crypto exchange-traded notes by 2025, impacting recognized exchanges.
This policy aims to enhance the UK’s crypto industry competitiveness, potentially boosting market liquidity and retail access.
UK FCA Set to Reverse 2021 Crypto ETN Ban
The UK FCA’s decision marks a shift since its 2021 ban on retail crypto ETNs. They propose allowing these high-risk investments to extend to individual investors. The FCA’s consultation paper signals a rebalance in risk approach, enabling people to decide if these products suit them, reflecting broader regulatory developments.
UK Retail ETN Market Poised for Growth
Lifting the ban may see increased ETN trading volumes in the UK, impacting major cryptocurrencies such as Bitcoin and Ethereum. The decision aligns with global trends yet maintains a cautious stance on derivatives, addressing transparency and volatility concerns in high-risk investments.
Lessons from European ETN Market Revisions
The initial ban aligned with cautious regulatory bodies like the SEC. Previous crypto ETN access re-openings showed market expansions in Europe. Anticipated results echo increased asset liquidity observed in past regulatory adjustments, potentially enhancing investor confidence and market stability.
This consultation demonstrates our commitment to supporting the growth and competitiveness of the UK’s crypto industry. 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. — David Geale, Executive Director of Payments and Digital Finance, FCA
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