FCA Will Make Final Decision On Whether To Ban Crypto Derivatives (CFDs and ETNs) in the UK
The government of the United Kingdom has recently affirmed that its regulators and the executive should decide whether crypto derivatives should be banned for retail investors or not. According to the reports, the economy secretary John Glen affirmed that the Financial Conduct Authority (FCA) was the only entity that would determine if the ban should be done.
Glen affirmed that the FCA is an independent entity that does not need the authorization of the government to act, so there is no need to get involved.
The trouble started after the report from the Cryptoasset Taskforce of the country. It was proposed that the FCA should consult the public on whether to ban contracts for difference (CFDs) and exchange-traded products in the country if they were related to Bitcoin or some other crypto asset.
So far, the FCA has received several complaints about the sale of crypto derivatives in the country. It was after these complaints that the entity launched the consultation. One of the initial ideas was that non-professional traders were not properly equipped to correctly assess the risks of these products.
It is difficult to determine the underlying value of the assets as they are very volatile and not properly regulated, so the FCA believes that retail investors would save money by not investing in them.
There are many critics to the idea of the ban, however. Coinshares, for instance, has claimed that the FCA is lacking evidence to affirm that trading crypto derivatives is a dangerous activity.