CoinShares urges customers to join fight against UK FCA’s proposed ban on crypto exchange-traded notes
Tue, 24 Sep 2019, 06:20 am UTC
CoinShares, a UK-based digital asset investment firm, is urging investors to support its fight against an impending ban on crypto exchange-traded notes (ETN) to be imposed by the UK’s Financial Conduct Authority (FCA).
In a letter to investors, the company is asking customers to submit their response to the FCA over the proposed ban via emails and text messages, saying “The more responses the FCA receives in protest to these measures, the more likely they are to see sense and abandon these proposals.”
“We believe that the FCA has not provided sufficient evidence to justify the proposed ban. Through its consultation, the regulator makes little attempt to genuinely evidence its claims and instead ‘cherry picks’ data sets in order to illustrate its perception of crypto assets, ETNs and the perceived harm the FCA believes these products cause,” CoinShares said.
CoinShares offers exchange-traded products for bitcoin, ethereum, litecoin, and XRP, CoinDesk reported.
In July, the FCA said that it is seeking to ban derivatives and ETNs linked to cryptoassets. The objective, it said, was to protect investors from sudden losses resulting from extreme volatility in the prices of cryptoassets.
CoinShares argued that the FCA’s analysis on cryptoassets and associated instruments “demonstrates a lack of understanding of their functionality, value and the motivations for why an investor might seek out such products.” It is asking customers to write to the FCA before the October 03 comment deadline.
CoinShares CSO Meltem Demirors told CoinDesk that the proposed ban could be a setback for the entire crypto industry, adding:
“If the FCA is successful in pushing this proposed ban through, it will mean that UK retail investors who currently enjoy access to the crypto-ecosystem via our ETNs will see their access cut off; with presumably little recourse. Additionally, the FCA has been clear in their consultation to note that they intend to work with other regulators to ensure the ban is not circumvented – so the potential contagion effect is very real even beyond the UK based on the FCA’s own words.”
In July, the FCA also published its final guidance, setting out the cryptoasset activities that fall under its regulation.
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