The UK Bans the Sale of Crypto Derivatives to Retail Consumers
After year long consideration, the FCA (Financial Conduct Authority) has published final rules on banning the sale of crypto derivatives and also exchange traded notes (ETN) to retail consumers, as these products are considered as ill-suited due the the harm they pose, according to FCA. From the 6th of January 2021, companies in the country will no longer be able to offer cryptocurrency derivatives products such as futures, options and ETNs.
The Authority said that unregulated transferable crypto assets are tokens that are not ‘specified investments’ or e-money, and can be traded, which includes well-known tokens such as Bitcoin, Ethereum or Ripple. It also stated that these products cannot be reliably valued by retail consumers because of the extreme volatility in crypto asset price, inadequate understanding of crypto and lack of legitimate investment need for retail consumers and few other reasons written on their website.
Bloomberg reported that retail investors currently holding any such crypto derivatives will be allowed to keep them for as long as they want. The FCA estimates that retail consumers will save around £53m from the ban on these products.
What do you think about this ban? Comment down below.
Disclaimer: Information found on Ivy Kepiro Ltd. is gathered from variety of sources to bring information to you. It does not represent the opinions of Ivy Kepiro Ltd. on whether to buy, sell, or hold any investments. You are advised to conduct your own research before making any investment decisions. Use provided information at your own risk.