The UK authorities may prohibit cryptocurrency derivatives


The office of financial regulation (the FCA) of great Britain plans to consider the idea of banning all cryptocurrency derivatives, particularly futures, options and securities. This measure can be adopted to protect consumers from the risks associated with investments in digital assets.

In the report the FCA also stated that the Agency will allow the listing cryptocurrency exchange-traded funds (ETFs) only if it is proven the reliability of the market, and the application for the opening of the ETF will meet the necessary criteria. The working group FCA also urged lawmakers to adopt normative acts regulating the cryptocurrency market.

It is important to note that the working group of the office of financial regulation recognizes the benefits of digital assets associated with the efficiency of transactions and opportunities to attract funding. However, according to employees of Management, the risks often outweigh the potential benefit from the use of virtual currencies, and methods of using a digital asset is limited to a small scale.

Last year, the FCA warned the British about the increased risk of investing in a cryptocurrency, however, the Agency did not impose any prohibitions or restrictions. In April 2018, the FCA issued a statement in which it was stated that trade cryptocurrency derivatives will be regulated in accordance with the Directive on financial instruments (MFID 2). Representatives of the office explained that digital assets at the legislative level is not a currency or a commodity, but they represent a financial instrument that falls under the scope of the Directive.

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