Summary
New regulations from the UK’s Financial Conduct Authority (FCA) have been met with public disapproval. The regulations, implemented in mid-February, have already impacted payment processors like PayPal and Luno, which have stopped users from purchasing Bitcoin. The FCA aims to counter “social and emotional pressures to invest” through the regulations, including competency tests on major exchanges that prevent users from accessing their funds. The FCA’s conservative stance on Bitcoin derivatives has put the UK behind other countries, including the US, Canada, Australia, and the EU. Legislators and industry leaders have voiced their objection to the regulations, but it remains uncertain when or if the FCA will change its policies.
Key Points
1. The British Financial Conduct Authority (FCA) has implemented new regulations on UK businesses dealing with Bitcoin and other cryptoassets, leading to public disapproval and impacting payment processors like PayPal and Luno.
2. The FCA aims to create “positive frictions” and counter “social and emotional pressures to invest” by imposing competency tests on major exchanges, preventing users from accessing their own funds.
3. The FCA’s conservative attitude towards the crypto industry has been criticized by legislators and industry leaders who argue that it may deter responsible and regulated operators from investing in the UK. Opposition to the regulations comes from different sectors, including government figures, industry leaders, and consumers.