FCA plans to lift crypto ETN ban for retail investors.

New rules limit cETNs to FCA-recognized trading exchanges only.

Strict promotion rules stay to protect investors from risky products.

In a new move, the UK’s Financial Conduct Authority (FCA) has proposed to lift its current ban on crypto exchange-traded notes (cETNs) for retail investors. With the new rule, individual people could use these types of investments, not just investors working in the financial field. It seeks to boost growth in the UK’s crypto industry.

FCA Eyes Safer Path for High-Risk Crypto Investments

In 2021, the FCA introduced the ban, explaining that crypto derivatives and ETNs were too risky for people who invest retail investors. Because of the law, only professional investors in the UK had access to these products until now. And since the crypto market has developed significantly, the FCA now proposes reconsidering its policy. The new rules would ensure that cETNs can trade only on recognized investment exchanges by the FCA.

Any movement to remove the ban does not affect the strict promotion rules that are still in place. The goal of these rules is to ensure that consumers get clear details about the possible threats. The FCA also wants to make certain that no one is given incorrect incentives to invest in crypto products. Thus, consumers will have the same kind of protection as those who buy cryptoassets themselves.

The FCA’s support for crypto is shown in the proposal, according to David Geale, its executive director for payments and digital finance. Moreover, he pointed out that consumers should have the opportunity to weigh the risks before going for high-risk investments. Still, he alerted investors that these products have the risk of losing all their invested money.

This proposal falls under the wider goal of the FCA’s crypto strategy. Not long ago, the regulator put out some proposals focused on stablecoins and other crypto matters. Even though the FCA is supporting open access to crypto investments, its rules prevent retail investors from trading cryptoasset derivatives.

FCA to Simplify Fund Reporting

Alongside this proposal, the FCA has introduced new policies to lighten the load for financial organizations. In its quarterly consultation paper, the FCA put forward ideas to make reporting about fund value assessments simpler. As a result, the change might save over 149 companies that administer over 3,900 funds a significant amount of money. Additionally, the FCA will remove redundant reporting requirements, which helps almost all firms in the sector.

Importantly, no plans for when the changes on cETNs could be introduced have been announced. The FCA will keep watching the market and respond by adjusting its actions as appropriate. In addition, financial promotion rules will act as an important shield for those investing in securities.

Bivu Das, Kraken’s UK General Manager, said that this proposal shows an important step forward for the country’s crypto industry. He said he appreciated the FCA’s decision, arguing that the existing limitations were no longer needed since the financial market was developed enough. According to Das, these changes in regulations will support the UK’s place in the worldwide digital asset sector.

Overall, the potential removal of the ban could lead to more people and resources flowing into the crypto market. On the other hand, this could cause new hazards for individual investors; therefore, keeping an alert eye and following proper laws is necessary.

The post UK FCA Proposes to Lift Ban on Crypto ETNs for Retail Investors appeared first on Live Bitcoin News.

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Filed under: Bitcoin - @ June 6, 2025 7:18 pm