FCA proposes ban on cryptocurrency products
The UK’s markets regulator has
proposed a ban on financial instruments linked to digital
cryptocurrencies, warning that such products could cause huge losses
for retail consumers unlikely to understand their risks or value.
The Financial Conduct Authority (FCA)
said products such as derivatives and exchange-traded notes (ETNs)
that reference crypto-assets were “ill-suited” to small
investors.
It cited their “extreme volatility”,
the difficulty in valuing them, consumers’ patchy understanding of
what they were buying and the increased risk of financial crime.
Investors might “suffer harm from
sudden and unexpected losses if they invest in these products”, the
FCA said, estimating that a ban would benefit consumers to the tune
of between £75m and £234.3m a year.
Source:
Theguardian
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