The UK’s Financial Conduct Authority (FCA) is proposing that the ban on offering crypto exchange traded notes (cETNs) to retail investors be lifted. The proposal, one of six presented in the FCA’s quarterly consultation paper, marks the latest development in the authority’s efforts to establish a regulatory framework for crypto.
If the proposal goes through, cETNs will be available to individual consumers rather than just professional investors. The caveat is that they must be traded on an FCA-approved investment exchange. The same financial promotion rules that apply to other crypto assets will also apply here, so buyers will be informed of the risks and not be offered inappropriate incentives to invest.
Although the FCA is considering lifting the ban on cETNs, it confirms that its ban on retail access to cryptoasset derivatives will remain. The regulator states in a press release that it will “continue to monitor market developments and consider its approach to high-risk investments”.
David Geale, executive director of payments and digital finance at the FCA, says, “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.”
