We are consulting on banning the sale, marketing and distribution of derivatives and exchange traded notes referencing cryptoassets to all retail consumers.
We believe that retail consumers can’t reliably assess the value and risks of derivatives (contracts for difference, futures and options) and exchange traded notes (ETNs) that reference certain cryptoassets. This is due to the:
We think these issues will cause retail consumers harm from sudden and unexpected losses if they invest in these products. We estimate a ban could reduce harm by £75m to £234.3m a year for retail investors.
This consultation will be particularly relevant for:
It is likely that the consultation will be relevant to additional stakeholders, both regulated and unregulated.
There is growing evidence that cryptoassets are causing harm to consumers and markets.
As a result, the UK Cryptoassets Taskforce, consisting of the Treasury, the FCA and the Bank of England, published a Final Report in October 2018 setting out the UK’s policy and regulatory approach to cryptoassets and made a number of commitments. It included a commitment to consult on a potential ban on the sale to retail consumers of derivatives that reference certain types of cryptoassets.
This consultation also follows:
We have also previously warned consumers about the risks associated with cryptoassets and related scams.
This consultation has now closed.
We will consider all feedback received by the closing date.
Should we decide to proceed with final rules, we intend to publish a final policy statement and Handbook rules in the second quarter of 2020.