David Geale, executive director of payments and digital finance at the FCA, explained that the agency wants to promote the UK crypto industry while also ensuring investor protections.<\/p>\n
\n\u201cThis consultation demonstrates our commitment to supporting the growth and competitiveness of the UK\u2019s 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, given they could lose all their money,\u201d David Geale, FCA. <\/p>\n<\/blockquote>\n
To balance risks, the rules on financial promotion will still apply. This means that institutions will have to provide investors with information about the risks involved with these assets. The FCA also explained that its ban on crypto derivatives for retail investors will remain in place.<\/p>\n
UK\u2019s FCA moves to clarify rules on crypto<\/h2>\n
The latest lift on the ETN trading ban for retail traders is part of a broader push to balance investor protection with innovation. On May 2, the FCA proposed banning retail investors from buying crypto assets with debt. Due to the volatility of crypto assets, debt-financed buying could expose investors to significant financial risk, the regulator argued.<\/p>\n
Unlike crypto exchange-traded funds, which are backed by the underlying asset, ETNs are unsecured debt notes tied to a specific index. This means they are higher-risk assets than ETFs, as they also expose traders to counterparty risk related to the issuer\u2019s solvency.<\/p>\n
<\/p><\/div>\n","protected":false},"excerpt":{"rendered":"
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