Connect with us

Hi, what are you looking for?

Editor’s Pick

Buying cryptocurrency ‘is not an investment’, MPs tell Financial Conduct Authority

Financial regulators came under pressure from MPs yesterday to stop firms using words such as “invest” and “investment” when promoting cryptocurrencies.

MPs on the Treasury select committee told Nikhil Rathi, chief executive of the Financial Conduct Authority, that even the health warnings in the small print of adverts risked giving the products undeserved credibility.

“The words ‘your investment’ endorse the idea that this is an investment on a par with a FTSE 100 company or a unit trust,” Harriett Baldwin, Conservative MP for West Worcestershire and a former banker with JP Morgan, said.

Rathi said he was expecting to get new powers over the promotion of cryptocurrencies. “We’ll have a discussion about what the wording should be,” he said. The FCA had in the past worked with the Advertising Standards Authority to clamp down on financial wording seen as unfair, unclear or misleading.

Charles Randell, chairman of the FCA, described his concern about some of the messages he saw on the side of London buses, but until the regulator got new powers, there was not much he could do. He had written to the chairman of Transport for London, offering help.

Rathi also revealed that the FCA was considering explicitly announcing that no compensation from the Financial Services Compensation Scheme would ever be paid to anyone losing money in crypto. Clear lines were needed, he said. “Personally, I would suggest we simply say that anything crypto-related should not be entitled to compensation, so that consumers are clear about that when they are investing.”

About 2.3 million people in Britain own cryptocurrencies, according to the FCA.

Asked whether cryptocurrencies were the 21st-century version of the Dutch tulip bulb market bubble, Rathi said some of them had “no intrinsic value” and “anyone who invests in them must be prepared to lose all their money”.

Baldwin also accused the FCA of helping criminals. “Your website actually publishes a list of unregistered crypto asset businesses for anti-money laundering purposes. It’s meant to be helpful but it could also be helpful to someone who just wants to launder money,” she said.

Rathi said the aim was to alert consumers to be cautious about using those firms, but conceded the information could be useful to criminals.

Read more:
Buying cryptocurrency ‘is not an investment’, MPs tell Financial Conduct Authority

Your information is secure and your privacy is protected. By opting in you agree to receive emails from us. Remember that you can opt-out any time, we hate spam too!

Latest

Editor’s Pick

Holiday bookings for three-star destinations are starting to drop as households hit by the cost of living crisis cut back amid rising bills, according...

Editor’s Pick

Pubs and restaurants have suffered a collapse in Christmas party bookings due to next week’s UK rail strikes. Industry chiefs suggest the plunge is...

Editor’s Pick

Meta Platforms has decided not to occupy part of its recently developed European HQ in Dublin and will instead sublet some of the site....

Editor’s Pick

Hundreds of soldiers have been told their Christmas leave is cancelled for the second year in a row after they were drafted in to...

News

Data is becoming the lifeline of businesses today. Organizations are beginning to realize that they have to know how to store and manage data...

News

Five-dollar bills are inspected at the Bureau of Engraving and Printing in Washington, D.C., March 26, 2015. — REUTERS THE PHILIPPINES’ dollar reserves dipped...

You May Also Like

News

BW FILE PHOTO GROSS BORROWINGS by the National Government reached P2.6 trillion as of end-September as it continued to raise funds to respond to...

News

REUTERS By Luz Wendy T. Noble, Reporter The country’s foreign exchange buffers slightly increased as of end-October as the value of the central bank’s...

News

KARASOLAR.COM TENA, Ecuador — Ecuador’s rainforest Achuar people say their ancestors long dreamed of a “fire canoe” or “electric fish” that would let them...

News

COVID-19 has had a significant impact on the mental health of Filipinos across different groups all over the archipelago. From frontline workers, parents balancing...

Disclaimer: Respect Investment.com, its managers, its employees, and assigns (collectively "The Company") do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

Copyright © 2022 Respect Investment. All Rights Reserved.