In a breakthrough verdict issued recently by the United Kingdom’s Financial Conduct Authority, corporations in the nation will no longer be able to offer digital asset derivatives products like options, futures, and exchange-traded notes (ETNs) to retail clients.
The verdict comes almost precisely one year after the regulator initially suggested prohibiting these products. In a statement released by the Financial Conduct Authority, the regulator claimed that digital asset derivatives are “ill-suited for retail consumers due to the harm they pose.”
FCA has given numerous reasons behind the decision. FCA mentioned apprehensions that they have no dependable foundation for valuation, are subject to exploitation and financial wrongdoings, and are enormously unstable.
Additional impetuses cited comprise the insufficient understanding of digital currencies by retail consumers and a prerogative that retail investors lack an authentic investment requirement for these products.
Notably, CoinShares is one of the companies that will be hit hardest by the ban. Last year, the company mounted a campaign to persuade the regulator to cancel its plans. The firm offers ETNs and other sorts of digital currency products intended at conventional markets.
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