UK Crypto Industry Reacts to FCA Lifting Crypto ETN Ban

Core Insights - The UK's Financial Conduct Authority (FCA) has lifted a four-year ban on the sale of crypto-linked exchange-traded notes (ETNs) to retail investors, marking a significant shift in regulatory stance towards crypto investment products [1][3][7] - This decision aligns the UK more closely with other European markets where such products have been available for a longer period [2] Regulatory Changes - The FCA's reversal of its 2021 decision allows recognized investment exchanges to list crypto ETNs for all investors, which are debt securities tracking the prices of cryptocurrencies like Bitcoin and Ethereum [3][4] - The FCA's Executive Director of Payments and Digital Finance noted that the market has evolved, with products becoming more mainstream and better understood since the initial restrictions [4] Market Demand - There is a growing appetite for regulated crypto exposure among UK investors, particularly among younger demographics, with a survey indicating that 30% of adults are open to investing in crypto ETNs, rising to 50% among those aged 18-24 [5][6] - A 2024 FCA survey revealed that only 12% of Britons currently hold crypto assets, with average holdings around £1,842, suggesting significant potential for growth in this market segment [6] Industry Reaction - The lifting of the ban has been welcomed by the UK crypto industry, which sees it as a regulated route for ordinary investors to gain exposure to digital assets without directly holding them [7][8] - Industry leaders express optimism that this development reflects the regulator's recognition of growing investor appetite and the potential of the crypto sector [8]