Britain’s markets watchdog said that more than 100 unregistered crypto asset firms posed a risk to the broader financial system. They had warned the consumers, banks and payment services companies against dealing with them.
Mark Steward, the Financial Conduct Authority’s (FCA) head of enforcement and market oversight, told City & Financial’s City Week event that such companies were high risk, volatile and unregulated. And then, 111 were operating in Britain without necessary registration. He stated that they have a number of firms that are clearly doing business in the UK without being registered with them and they are dealing with banks, payment services firm and also consumers. This is a very real risk so they are worried about that.
The FCA was appointed in anti-money laundering and counter terrorist financing supervisor of crypto asset firms, in January. And such businesses have had to obtain full FCA registration before they can begin trading. Steward said that only a handful have been posing a financial crime risk. Almost 2.5 million British adults now hold crypto assets. Over the last year, there is a sharp rise in people spending more online time, because they are locked indoors by this pandemic. Steward said that many new investors, who tended to be male, over 35 years old, funded by credit and less knowledgeable than 18 months ago, ran the risk of falling prey to tulip mania. He added that the reason many are investing now, because they have a fear of missing out on what might be a boom. Leaving aside how volatile these instruments actually are, it has tulip mania written all over it.