Top Exchanges Urge UK Regulator Not to Ban Cryptocurrency Derivatives

Some of the world’s top exchanges, including the CME, Nasdaq, and the Intercontinental Exchange, has asked the UK’s markets watchdog, the Financial Conduct Authority (FCA) not to ban cryptocurrency derivatives for retail investors.

Via an announcement published Monday the World Federation of Exchange (WFE) urged the FCA not to ban cryptocurrency derivatives as it needs to find a balance between enabling innovative products to be traded on the market and ensuring these are safely traded by regulated providers.

The WFE’s CEO Nandini Sukumar was quoted as saying:

We ask that authorities, including the FCA, chart the right regulatory course to allow the market to flourish and benefit its consumers even as we understand that it’s a balancing act.

The WFE argues the exchanges are well-equipped to protect consumers trading on their platforms. As CryptoGlobe covered, the FCA proposed a ban on cryptocurrency derivatives and exchange-traded notes to retail investors in July of this year, noting these products weren’t suited for these investors because of their “extreme volatility.”

While the WFE said it recognized their volatility and supports “ensuring that proper consumer protection is in place,” but it argues banning cryptocurrency derivatives isn’t the right move. The FCA is set to announced final rule changes next year, and if it goes ahead with a ban the WFE has called for a review after some time.

Crypto Rating Council Evaluates Three New Cryptocurrencies as Securities

  • The Crypto Rating Council has released securities ratings for IOTA, Basic Attention Token and USDCoin.
  • The CRC, backed by Coinbase, Kraken and other US crypto firms, supports regulation clarity for the industry.

The Crypto Rating Council (CRC) has evaluated IOTA, Brave's Basic Attention Token (BAT) and the USDC stablecoin over whether they should be classified as securities. 

The CRC, backed by Coinbase, Kraken and other exchanges, is a collection of major United States-based crypto firms established in September 2019. The group advocates for and promotes regulation clarity in the industry of cryptocurrency, including analyzing whether or not certain assets should be classified as securities. 

According to an April 2 post, the CRC released rating scores for IOTA, USDC and BAT, in addition to updating its rating for Maker and Polymath. The scale ranks from 1 to 5 with a lower score correlated to few or no characteristics consistent with treatment as a traditional security. 

BAT was given a rating of 2.00, with the council highlighting the coin’s utility as fully open-sourced and supporting the development and use of the Brave Browser. IOTA also scored 2.00, indicating that the currency is unlikely to be viewed as a security.

USDCoin, a stablecoin backed by Coinbase and Circle, was rated 1.00 by the council, consistent with other stable price-pegged coins such as DAI.  

While the CRC’s determinations have no official impact on the opinions of regulators such as the Securities & Exchange Commission (SEC), they do provide some insight to investors on the state of crypto-assets. 

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