The United Kingdom’s Financial Conduct Authority (FCA) has rejected the idea that investors should be compensated for losses caused by crypto-trading. The FCA said it does not believe in “any such scheme” and maintaining investor protection is its top priority.
The “future of cryptocurrency 2021” is a question that has been asked many times. The UK’s Financial Conduct Authority CEO believes that the nation should not compensate investors for crypto losses.
When challenged about the hazards of the country’s mostly unregulated cryptocurrency market, Nikhil Rathi, CEO of the Financial Conduct Authority, or FCA, gave the following remark before the Treasury Committee on Wednesday:
When it comes to the compensation program, certain clear boundaries must be drawn. Anything crypto-related, in my opinion, should not be eligible for remuneration, and investors should be aware of this before investing.
Rathi mentions the Financial Services Compensation Scheme, or FSCS, of the Financial Conduct Authority, which compensates customers when certain regulated financial institutions fail to fulfill claims against them, such as during bankruptcies, criminal schemes, or insurance breach-of-contract claims. In principle, the new laws would bar UK crypto investors who have been duped by purportedly fraudulent cryptocurrency exchanges or decentralized finance rug pulls from collecting government reimbursement since they are either unregulated or operate in legal murky areas. The Financial Services Compensation Scheme (FSCS) handed out more than 717 million pounds to clients this year to compensate them for their financial losses.
Nikhil Rathi testifies before the Treasury Committee | parliamentlive.tv is the source of this information.
“Cryptocurrencies are supported by technology that, I believe, we would identify as having major advantages and value, such as combating financial crimes. However, we have voiced concerns about a number of developments “When questioned about the country’s regulatory system, Rathi said. “We don’t think that some of these crypto-assets have fundamental worth. They’ve been linked to a slew of organized crime and money laundering schemes, and anybody who invests in them can expect to lose their whole investment.”
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