FCA Lifts 4-Year Retail Ban on Crypto ETNs – Access Returns Oct. 8

Key Points

1. Retail investors can invest in crypto ETNs if traded on an FCA-recognised UK-based investment exchange (RIE), with firms required to comply with UK financial promotion rules.

2. The FCA stated that the market has evolved since the 2021 ban, prompting the policy shift to provide more consumer choice while maintaining protections.

3. The Financial Services Compensation Scheme (FSCS) will not cover crypto ETNs, requiring consumers to assess risks independently, though firms must adhere to Consumer Duty rules.

4. This decision aligns with the FCA's broader effort to develop a regulatory framework for cryptoassets, following earlier steps like allowing institutional investors to access crypto ETNs in March 2024.

5. Industry experts, such as Laurent Kssis of CEC Capital, view the move as aligning the UK with global standards and improving investor access to regulated crypto products.