The ban of the Financial Conduct Authority on the sale of exchange-traded notes (ETNs) and derivatives that was passed back in October has been put into force this Wednesday.
The financial regulator of the U.K. has stated it views the products as not suited for retail consumers because of the potential damage they can cause.
The imposed regulation has been criticized by representatives of the crypto industry, who argue the ban is aimed at private individuals and that retail investors must have equal access to opportunities as institutions.
The total ban on cryptocurrency derivatives will push retail investors to unregulated platforms such as Deribit and BitMEX. They will provide much less protection than the regulated platforms, argues Dermot O’Riordan, speaking on behalf of Eden Block.
The British investment firm Hargreaves Lansdown enacted the new rules before the deadline and removed products like the XBT Bitcoin tracker from its website.
“Investors will no longer be capable to purchase these products via HL, but they are still able to continue keeping investments that they have already acquired and can sell them when they decide to do so,” noted Danny Cox, who is the head of external relations at the investment firm.
