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UK's Ban on Crypto Derivatives Goes Into Effect Today
The Financial Conduct Authority ban on the sale of derivatives and exchange-traded notes was passed in October.
The Financial Conduct Authority's (FCA) ban on the sale of derivatives and exchange-traded notes (ETNs) passed in October went into effect Wednesday.
STORY CONTINUES BELOW
- The U.K. financial regulator has said it considers the products to be ill-suited for retail consumers due to the potential harm they pose.
- The new regulation is being criticized by some in the crypto sector, who argue the ban is a setback and that retail investors should have access to the same opportunities as institutions.
- The banning of cryptocurrency derivatives will drive retail users to unregulated platforms like Deribit and BitMEX, which will offer even less protection than the regulated players, argued Dermot O'Riordan, partner of Eden Block, a European venture capital firm focused on blockchain technology.
- U.K.-based investment firm Hargreaves Lansdown took action ahead of the deadline and removed products such as the XBT bitcoin tracker from its platform.
- “Investors are no longer able to buy these products through HL, but they can continue to hold investments that they already own, and can sell them when they wish to do so," said Danny Cox, head of external relations at Hargreaves Lansdown.
Read more: FCA Bans Crypto Derivatives for Retail Consumers in UK
Tanzeel Akhtar
Tanzeel Akhtar has contributed to The Wall Street Journal, BBC, Bloomberg, CNBC, Forbes Africa, Financial Times, The Street, Citywire, Investing.com, Euromoney, Yahoo! Finance, Benzinga, Kitco News, African Business Magazine, Hedge Week, Campden Family Office, Modern Investor, Spear's Wealth Management Magazine, Global Investor, ETF.com, ETF Stream, CIO UK, Funds Global Asia, Portfolio Institutional, Interactive Investor, Bitcoin Magazine, CryptoNews.com, Bitcoin.com, The Local, The Next Web, Mining Journal, Money Marketing, Marketing Week and more. Tanzeel trained as a foreign correspondent at the University of Helsinki, Finland and newspaper journalist at the University of Central Lancashire, UK. She holds a BA (Honours) in English Literature from the Manchester Metropolitan University, UK and completed a semester abroad as an ERASMUS student at the National and Kapodistrian University of Athens, Greece. She is NCTJ Qualified - Media Law, Public Administration and passed the Shorthand 100WPM with distinction. She does not currently hold value in any digital currencies or projects.
