Britain will prohibit consumer lending to buy cryptocurrency

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The United Kingdom is planned to ban retail investors who borrowed money in order to invest in cryptocurrents as Bitcoin, as it seeks to bring a much quickly growing market for the first time.

Lending restrictions for CRIPTO purchases are part of deletion Set of rules described by financial behavior on Friday, a few days after the government presented its Plans laws to laws for the digital asset market.

“The Cripto is the area of ​​potential growth for the UK, but it must be done correctly,” financial time said, David Geale, CEO of FCA and digital finance. “To do this that we must provide an appropriate level of protection.”

Releasing the request of some CRIPTO assets that FCA is hostile to its industry, Geale said, “I would in a way compared this any high risk investment, which if anything often has less protection.”

FCA proposals aim to make most of Cripto Market According to its regulatory regime, including trading platforms, intermediaries, crypto lenders and borrow and borrowers and decentralized financial systems. The plans apply a much strict set of rules to the CRIPTO services provided by retail investors than those dealing only by professional or sophisticated investors.

Retail customers can be decided to be treated as election professional clients, giving them more freedom in how they invest but less protection. Most people must meet at least two of the three criteria: there are more than 500,000 pounds for investment, working at least 10 quarters and have at least one year as a financial professional.

“We started from a position that we would like to develop something that is safe and competitive,” Geale said. “If we can receive the regulatory regime, it actually becomes attractive for firms. That is what we try to achieve.”

FCA said that it was planned to limit companies to borrow consumers to finance their purchases of crypto – including credit cards in relation to “unsustainable debt, especially if they have replapped in its value”.

The percentage of people in the UK crypto buying borrowing is more than doubled from 6 percent in 2022. To 14 percent last year, in accordance with the recent Yougov survey.

FCA also said that she planned to block retail investors from accessing a specialist crypt of lenders and users of loans such as Celsius network that collapsed 2022 years in the middle of the wider crisis in the sector.

The regulator has stated numerous concerns due to the trading of cryptian assets, including market manipulation, conflict, settlement failures, lack of transparency, illiquidity and non-condensation and unreliable trade systems.

To Tackle Some Of These, The FCA Will Require Crypto Treat Platforms to Treat All Trades Equally, To Separate Their Own Proprietary Trading Activities from Those Done for Retail Investors and To Provide Transparency on Pricing and Execution of Trades.

Ban will prohibit trading platforms from payment of orders flow and require all companies to offer cripto trading in large Britishes to operate through an authorized legal entity in the country.

Consumers who park their crypt’s property with “Putting services” in exchange for return will need to compensate for all losses caused by third actions.

Decentralized finance systems, which do not have centralized work and run clean on the lines of computer code, will be free from new FCA regulations, unless they have “clear control”.

While warning “most cryptic assets will remain high risk and consumers should be ready to lose all their money if they buy them”, FCA said “encouraging growth” growth growth “.

The CRIPTO companies frustrated with FCA at a high level of department in the regulator registration program with its money laundering rules.

The regulator rejected 86 percent of such applications at 12. months until April 2024. years, but in the last fiscal year, the direction fell to 75 percent.

Cripto managers supported FCA focus to consumer protection.

“As such an internationally influential regulator, as soon as FCA regulates the crypto market, so I understand their caution,” Joei Garcia, Head of Public Affairs at Xapo Bank, as soon as we deal C XAPO Bank at XAPO Bank.

Riccardo Torder-Ricchi, the director of the Payment Association, Trading Body, said, “The government says it is open to business, but in a practical term will be difficult to implement it – they do not have an easy job.”

Companies have up to 13. June to respond to FCA proposals.