UK FCA Lifts Ban on Retail cETNs for Growth – Coincu

The UK Financial Conduct Authority (FCA) announced plans on June 6 to lift the retail ban on cryptocurrency exchange-traded notes (cETNs). The measure aims to enhance the UK’s digital asset industry competitiveness.

The move is significant for retail investors seeking access to cryptocurrency markets and aligns with the UK’s ambition to be a crypto-friendly jurisdiction.

UK FCA Lifts Ban on Retail cETNs for Growth

The UK Financial Conduct Authority (FCA) announced lifting the retail ban on cryptocurrency exchange-traded notes (cETNs) to foster growth and competitiveness in the digital asset sector. Retail investors may now access cETNs only through FCA-approved exchanges, ensuring a regulated trading environment.

This decision by the FCA, announced on June 6, introduces a shift in market dynamics. It broadens the investor base, largely benefiting major cryptocurrencies like Bitcoin and Ethereum as underlying assets. “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,” said David Geale, Executive Director of Payments and Digital Assets, FCA.

Diego Ballon Ossio of Clifford Chance underscores the alignment with the UK’s crypto-friendly goals but notes the need for better regulatory frameworks. Other crypto hubs, like the EU, already permit retail access under certain conditions, which this decision mirrors, albeit cautiously.

UK Market Prepares for Retail-Driven Growth in Cryptocurrency

Did you know? The 2021 FCA ban discouraged retail market participation in regulated crypto securities, prompting some investors to offshore venues.

According to CoinMarketCap, Bitcoin (BTC) is priced at $103,974.17 with a market cap of $2.07 trillion. BTC represents 63.74% market dominance. Recent data shows a 0.69% price decline in the past 24 hours, contrasting with a 7.20% growth over 30 days. Trading volume reached $62.28 billion, a 46.31% increase.

Coincu’s research suggests that allowing retail access to cETNs might eventually provide safer crypto investment options in regulated markets. This move could significantly influence global adoption trends, urging other jurisdictions to revisit crypto regulations.