UK's FCA looks to ban sales of crypto derivatives including CFDs and futures


In a speech delivered today, Christopher Woolard, the Executive Director of Strategy and Competition at the UK's Financial Conduct Authority (FCA), said that the FCA will consult on a prohibition of the sale to retail consumers of derivatives referencing certain types of cryptoassets including contracts-for-difference, options, futures and transferable securities.

Key quotes

  • The scale and pace of cryptoasset change - and what it might mean for consumers and markets - also requires vigilance from policymakers.
  • Whilst cryptoassets are not currently widely used in the UK, and the UK is not a major exchange market for cryptoasset trading relative to the global one, we are concerned about the potential harm posed by current usage of these often poorly-understood cryptoassets.
  • The taskforce has concluded that there are 3 major harms associated with cryptoassets.,
    • The first harm is to consumers, who may buy unsuitable products, face large losses, be exposed to fraudulent activity, struggle to access market services, or be exposed to the failings of service providers, such as exchanges.
    • Opaque practices and misconduct could damage confidence in wider market functioning.
    • We cannot overlook the risk of financial crime, where cryptoassets have been used as part of illicit activity such as money laundering and fraud.
  • We’re concerned that retail consumers are being sold complex, volatile and often leveraged derivatives products based on exchange tokens with underlying market integrity issues.
  • To combat financial crime risks, the Treasury will undertake one of the most comprehensive responses globally to the use of cryptoassets for illicit activities by applying and going further than the existing directive, the fifth EU Anti-Money Laundering Directive (5AMLD). 
  • The Treasury plan to complete further analysis on whether regulation could meaningfully and effectively address the risks posed by exchange tokens and what, if any, regulatory tools would be most appropriate.
    • HMT will consult in early 2019 on whether and how exchange tokens, as well as related actors such as exchanges and wallet providers, could be regulated effectively.
  • We will also seek to work collaboratively with international counterparts, including standard-setters and other national jurisdictions.

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility.

Cryptos feed

Latest Crypto News & Analysis

Editors’ Picks

Top 3 price prediction Bitcoin, Ripple, Ethereum: Cryptos seeing multiple launches into the universe

The BTC/USD pair is currently trading at the $10.187 price level, the same price level as in recent weeks. The most serious difficulty for Bitcoin is the low volatility, after many days in the same price range, strength and speed indicators are at minimum levels. It will not be easy to start again.

More Bitcoin News

Ethereum (ETH) price analysis: ETH/USD settles above $200.00 amid altcoins'bull run

The second-largest cryptocurrency with the current market capitalization of $22.9 billion hit $215.18 during early Asian hours. While the coin has retreated to $212.40 by the time of writing, the upside momentum remains strong as the coin stays above a critical $200.00.

More Ethereum News

NEO price analysis: NEO/USD retreats from intraday high, upside momentum recedes

NEO is performing strongly on Wednesday. The 20th largest digital asset with the current market value of $69 million gained over 7% both on a day-on-day basis and moved nearly 3% higher since the beginning of the day.  At the time of writing, NEO/USD is changing hands at $9.80, off the intraday high of $9.87. 

More NEO News

TRON market update: TRX/USD tests DMA50 for the first time since July

TRON (TRX) is one of the best performing coins on Wednesday. TRX/USD has gained over 10% of its value to trade at $0.0178 by press time. While the coin has retreated from the intraday high ($0.0178), the upside momentum is still strong as TRX is moving in sync with the rest of the market. 

More Tron News

BEST CRYPTO BROKERS/EXCHANGES

Bitcoin Weekly Forecast: Rangebound trading and September blues come upon the crypto market

Bitcoin finishes the week with marginal losses. The first digital currency recovered from the recent low of $9,886 but stayed in the red zone as of the end of the week.

Read the weekly forecast

BTC

ETH

XRP