According to its earlier press release, the FCA described crypto derivatives as “ill-suited for retail consumers due to the harm they pose. The agency gave several reasons why these classes of offers should not be accessible to retail investors. For one, they believe that cryptocurrencies have “no reliable basis for valuation.” This is in addition to the extreme volatility of the assets and a supposed inadequate understanding of crypto assets by retail consumers.
To drive home its ban, the regulator claimed that the restriction will save retail investors up to £53m.
But despite the perceived valid points the regulators may have given, industry commentators believe that no form of restriction or regulation could stop retail investors. Rather, such bottlenecks would only drive consumers onto unregulated exchanges or offshore.
Speaking on the matter, Dermot O’Riordan of Eden Block criticized the FCA’s ban on crypto derivatives. He said:
Source: Cryptocurrency - investing.com
