The decision over whether to ban the sale of crypto derivative products to retail customers in the UK will be determined solely by the financial regulator. This was the message delivered by Economic Secretary to the Treasury, John Glen, in an answer to a question posed by the Member of Parliament for Shipley, Philip Davies.
Referring to a commitment by the Financial Conduct Authority to launch consultations to find out the implications of prohibiting the sale of cryptocurrency derivatives to retail investors, Glen indicated that it was up to the financial regulator to make the determination. The UK Treasury economic secretary said this while noting that the FCA “is operationally independent from government.”
Besides shifting responsibility for the ban on crypto derivatives, the economic secretary also evaded answering the Shipley MP’s questions fully. Davies had specifically asked for the Chancellor of the Exchequer’s “assessment” with regards to the proposed FCA ban on retail investors signed up with financial technology firm Revolut and other financial institutions that deal in crypto-asset derivative products. Currently, the Chancellor of the Exchequer, the UK equivalent of a finance minister, is Sajid Javid.
Davies had also wanted to know Javid’s assessment on the effect of the proposed FCA ban on crypto derivatives to the status of the UK as a financial technology hub. The Shipley MP sits in the Digital, Culture, Media and Sport Committee in the House of Commons. Additionally, Davies had wanted Javid to offer his assessment regarding whether the FCA had complied with the laws governing the regulatory body.
Davies’ question comes nearly a year since the FCA released a report which indicated that the regulator would conduct consultations regarding the “potential prohibition of the sale to retail consumers of derivatives referencing certain types of crypto assets.”
In July, the FCA again reiterated its desire to ban the crypto derivatives products, citing a need to “address harm to retail consumers.”
This article was edited by Gerelyn Terzo.