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The UK bans the sale of encryption derivations, expected to result in a potential loss of £53M annually.
The UK's financial regulators have taken action to ban the sale of Crypto Assets derivatives to retail investors. This decision stems from concerns about the Crypto Assets market, including its severe price Fluctuation and associated risks.
Regulators believe that ordinary investors find it difficult to fully assess the potential risks of such investments, including factors such as project quality, safety threats, and the lack of a reliable valuation basis. This ban aims to protect individual investors from possible significant losses.
The new regulations will come into effect on January 6, 2021. Regulators expect that this measure could reduce potential losses for ordinary investors by approximately £53 million annually. It is worth noting that the impact of this ban is extensive, affecting not only Crypto Assets trading platforms but also related brokers, investment platforms, and financial advisors.
This regulatory measure reflects the ongoing concern of regulatory authorities regarding the risks of the Crypto Assets market, as well as their determination to protect the interests of ordinary investors. As the Crypto Assets industry continues to evolve, similar regulatory measures may emerge in other countries and regions to address the challenges posed by this emerging financial sector.