FCA Proposes Lifting Ban on Crypto ETNs for Retail Investors

The UK Financial Conduct Authority (FCA) has recently released a consultation paper proposing to lift the ban on selling crypto exchange-traded notes (crypto ETNs) to retail investors. If approved, this move would give individual investors in the UK access to a product category already available in many other countries.

Retail Access to Crypto ETNs May Soon Be Possible

Under the proposal, retail investors would be allowed to trade crypto ETNs as long as the products are listed on an FCA-recognized investment exchange (RIE). The change aims to expand access to investment products while ensuring that consumers receive adequate risk disclosures and regulatory safeguards. The FCA reiterated that these products remain high-risk and that participation should be based on fully informed, individual decision-making.

“We aim to strike a balance between risk management and market freedom,” said David Geale, Executive Director for Payments and Digital Assets at the FCA. “Lifting the ban means returning the choice to individuals—so they can decide whether to participate in high-risk investments.”

Broader Regulatory Efforts in Crypto Oversight

The proposed change marks another step in the UKs ongoing efforts to build a comprehensive regulatory framework for cryptoassets. The FCA has already approved crypto ETNs for professional investors and has recently issued proposals covering areas such as stablecoins and custody services.

However, the regulator emphasized that its ban on other high-risk crypto derivatives for retail investors will remain in place.

A Shift Toward Balanced Regulation

The proposal comes as the UK government seeks to promote economic growth and establish itself as a global hub for digital assets. Alongside this move, the FCA has introduced other suggestions to reduce regulatory burden, including simplifying fund valuation reports and eliminating unnecessary data submissions—measures aimed at enhancing overall market efficiency.

Against the backdrop of global regulatory developments, the UKs latest step signals a broader shift from cautious observation to a more supportive stance toward compliant growth in the digital finance sector.