CP19/22: Restricting the sale to retail clients of investment products that reference cryptoassets

Open consultation: CP19/22
Consultation closes
Policy statement and Handbook rules
Q2 2020
Q2 2020

We are consulting on banning the sale, marketing and distribution of derivatives and exchange traded notes referencing cryptoassets to all retail consumers.

Read CP19/22 (PDF)

Why we are proposing changes

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:

  • inherent nature of the underlying assets, which have no reliable basis for valuation
  • prevalence of market abuse and financial crime (including cyberthefts from cryptoasset platforms) in the secondary market for cryptoassets
  • extreme volatility in cryptoasset prices movements
  • inadequate understanding by retail consumers of cryptoassets and the lack of a clear investment need for investment products referencing them

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.

Who this applies to

This consultation will be particularly relevant for:

  • firms issuing or creating products referencing cryptoassets
  • firms distributing products referencing cryptoassets, including brokers and investment platforms, and financial advisers
  • firms marketing products referencing cryptoassets
  • operators of trading venues and platforms
  • retail consumers and consumer organisations

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:

  • Our Policy Statement (PS19/18) published on 1 July 2019, which finalised rules restricting the sale of CFDs and CFD-like options to retail clients, including setting 2:1 leverage limits on contracts that reference cryptocurrencies.
  • And our Perimeter Guidance Consultation on Cryptoassets (CP19/3) published in January 2019, which clarified what types of cryptoassets fall within our current regulatory perimeter. The consultation closed in April and we expect to publish Final Guidance on Cryptoassets in late summer 2019.

We have also previously warned consumers about the risks associated with cryptoassets and related scams.

Next steps

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.