On 3 July 3 2019, the UK Financial Conduct Authority (FCA)
issued a consultation paper (CP19/22) on prohibiting the sale,
marketing and distribution to retail clients of investment products
that reference unregulated cryptoassets that allow transferability
(i.e., can be widely exchanged on cryptoasset platforms or other
forums). The prohibition will cover firms acting in, or from, the
UK.
The investment products within the scope of the prohibition are
contracts for difference (CFDs), futures and options and exchange
traded notes (ETNs), which the FCA believes pose similar risks to
derivatives on tokens. "Referencing" includes derivatives
that use an index or benchmark price for tokens within the
contract, as well as those using a single price from a cryptoasset
trading platform. The derivatives and ETNs within the scope of the
ban are referred to by the FCA as
"crypto-derivatives".
