UK FCA offers 3 ways to regulate crypto

Mon 06 Sep 2021 ▪ 14h52 ▪ 3 min read — by Susan McCormack

The Financial Conduct Authority of the United Kingdom (FCA) offers three methods of regulating digital assets that are expected to help keep investors safe.

What’s on offer?

Charles Randell, Chair of the Financial Conduct Authority (FCA) and the Prudential Regulation Authority (PRA), participated in the Cambridge International Symposium on Economic Crimes, where he declared a speech highlighting the problems and risks associated with regulating cryptographic currencies.

“These tokens have only been around for a few years, so we haven’t seen what will happen over a full financial cycle.  We simply don’t know when or how this story will end, but – as with any new speculation – it may not end well,” said Randell.

The FCA representative also stated that cryptocurrencies are not regulated by the Financial Regulation and Supervision Authority of the United Kingdom, and therefore, consumers are not covered or protected by the Financial Services Compensation Scheme and cannot claim damages.

“It’s difficult for regulators around the world to stand by and watch people, sometimes very vulnerable people, putting their financial futures in jeopardy, based on disinformation and fear of missing out,” Randell added. 

As reported by Decrypt, the FCA chairman believes the solution lies on the surface. Regulators that oppose the crypto industry need to focus on three primary issues..

First, make it harder for cryptocurrencies to be used for financial crime. Second, support useful innovations. Finally, determine how free consumers should be to purchase unregulated speculative digital assets before the regulator intervenes.

“The tide of regulation is turning all over the world, and online platforms should expect a future where regulation addresses the significant risks they pose in the same way as other businesses.  Same risk, same regulation,” Randell said.

This is not the first time that the FCA has spoken out against the risks in the crypto industry.

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Susan McCormack

How many crypto nerds does it take to fork an altcoin? I may be a failed comedian, but crypto is no joke! I want to share my knowledge and help others to see the bright future ahead. #buybitcoin

DISCLAIMER

The views, thoughts, and opinions expressed in this article belong solely to the author, and should not be taken as investment advice. Do your own research before taking any investment decisions.

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