FCA published results of the research on UK consumer attitudes to, and awareness of, crypto-assets, such as Bitcoin and Ether, in the UK. The research includes a national survey and qualitative interviews with UK consumers. Out of the pieces of the published research, one report by the research firm Revealing Reality explores the attitudes, understanding, and motivations behind the consumer decisions to purchase and use different crypto-assets. The second report is by the research firm Kantar TNS and it looks at the consumer awareness, understanding, and purchasing habits related to crypto-assets.
The qualitative research indicated some potential harm, including that many consumers may not fully understand what they are purchasing. However, despite the general poor understanding of crypto assets among UK consumers, findings from the survey suggest that the overall scale of harm may not be as high as previously thought. Seventy-three percent of the surveyed UK consumers do not know what a crypto currency is or are unable to define it. FCA estimates that only 3% of consumers surveyed had ever bought crypto-assets.
FCA has previously warned that cryptoassets, including Bitcoin, are highly volatile and risky. Many tokens (including Bitcoin and "cryptocurrency" equivalents) are not currently regulated in the UK. This means that the transfer, purchase, and sale of such tokens currently fall outside the regulatory remit. Thus, it is unlikely that consumers will be entitled to register complaints with the Financial Ombudsman Service or protected by the Financial Services Compensation Scheme, if things go wrong. FCA is working with the Government and BoE, as part of a UK Cryptoassets Taskforce, to understand and address the harms from crypto-assets and encourage innovation in the interests of consumers. FCA is also consulting on the guidance to clarify the types of crypto-assets that fall within the existing regulatory perimeter. Later this year, FCA is expected to consult on banning the sale of certain crypto-asset derivatives to retail investors. HM Treasury is also exploring legislative change to potentially broaden the regulatory remit of FCA to bring in further types of crypto-assets.
- Press Release
- Crypto-Assets: Ownership and Attitudes (PDF)
- How and Why Consumers Buy Crypto-Assets (PDF)
Keywords: Europe, UK, Banking, Securities, Crypto-Assets, Regtech, Consumer Research, Distributed Ledger Technology, FCA
Previous ArticleBCBS Publishes Basel III Monitoring Updates in January 2020
The European Banking Authority (EBA) has published the final templates, and the associated guidance, for collecting climate-related data for the one-off Fit-for-55 climate risk scenario analysis.
The European Banking Authority (EBA) recently published a report that recommends enhancements to the Pillar 1 framework, under the prudential rules, to capture environmental and social risks.
As a follow on from its prudential standard on the treatment of crypto-asset exposures, the Basel Committee on Banking Supervision (BCBS) proposed disclosure requirements for crypto-asset exposures of banks.
The Basel Committee on Banking Supervision (BCBS) and the European Banking Authority (EBA) have published results of the Basel III monitoring exercise.
The Prudential Regulation Authority (PRA) recently issued a few regulatory updates for banks, with the updated Basel implementation timelines being the key among them.
The U.S. Department of the Treasury has recently set out the principles for net-zero financing and investment.
The European Commission (EC) launched a stakeholder survey on the draft International Guiding Principles for organizations developing advanced artificial intelligence (AI) systems.
The finalization of the two sustainability disclosure standards—IFRS S1 and IFRS S2—is expected to be a significant step forward in the harmonization of sustainability disclosures worldwide.
Decentralized finance (DeFi) is expected to increase in prominence, finding traction in use cases such as lending, trading, and investing, without the intermediation of traditional financial institutions.
The Basel Committee on Banking Supervision (BCBS) published reports that assessed the overall implementation of the net stable funding ratio (NSFR) and the large exposures rules in the U.S.