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FCA Opens Retail Access to Crypto ETNs
FCA Crypto ETNs are now open to UK retail investors, following changes announced by the Financial Conduct Authority (FCA).
cETNs that retail consumers can access must be traded on an FCA-approved, UK-based investment exchange (a Recognised Investment Exchange or RIE). Financial promotion rules will apply so consumers get the right information and aren’t offered inappropriate incentives to invest.
David Geale, executive director of payments and digital finance at the FCA, said: “Since we restricted retail access to cETNs, the market has evolved, and products have become more mainstream and better understood. In light of this, we’re providing consumers with more choice, while ensuring there are protections in place. This should mean people get the information they need to assess whether the level of risk is right for them.”
The Consumer Duty will apply to firms offering these products to retail investors. However, there won’t be coverage from the Financial Services Compensation Scheme (FSCS). Consumers should ensure they understand the risks before deciding to invest.
This is the latest development as the FCA continues to establish a regulatory framework for crypto. The regulator has outlined its crypto roadmap and recently published proposals on stablecoins as well as other aspects of the regime.
The FCA’s ban on retail access to cryptoasset derivatives will remain in place. The regulator will continue to monitor market developments and consider its approach to high-risk investments.
With retail access to FCA Crypto ETNs now in place, the UK takes a step toward regulated crypto investing, under the FCA’s evolving digital finance roadmap.
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