One of the reports brought out this week includes a contribution by Forbes Magazine. With one of its publishers making some pretty brash statements, presuming the intent of both the UK Financial Conduct Authority, along with the broader British Government.
In the article, he pieces together that statements made by its director of strategy and competition - Christopher Woolard late in July.
“Today’s guidance will help clarify which crypto-asset activities fall inside our regulatory perimeter,” going further, Woolard reiterated an already issued word of caution for traders:
“Consumers should be cautious when investing in such crypto-assets and should ensure they understand and can bear the risks involved with assets that have no intrinsic value.”
In the mind of this particular reporter, this represents a move by the UK 'towards a crypto ban.'
While this would come as some kind of surprise if it were true, that's exactly the point - It's not true. And while, to some, the FCA's warning seems like it would be a step in the direction of a ban, it completely ignores just WHAT it pertains to, and some of the nuances behind recent developments behind Libra, for example.
Lets put things into a bit more perspective by laying out where this notion of a 'ban' came from. Long story short, it's a proposal brought forward by the FCA after the publishing of research conducted by its task force.
While it is a ban, it simply refers to a 'proposed' ban on retailers accepting crypto-assets as a medium of exchange.
"CP 19/22 - Prohibiting the sale to retail clients of investment products that reference cryptoassets." The consultation continues on to illustrate just what it seeks to achieve with any kind of ban:
"We are seeking to reduce the harm to retail consumers caused by the sale of
derivatives and ETNs referencing unregulated transferable cryptoassets."
So does this represent a ban on ALL crypto-assets? No. The British Government has already taken a number of steps to provide informative resources on the subject of cryptoassets and investing in them.
Why then would they suddenly turn around and ban them after going to all the trouble of incorporating them and generating taxable revenue from those investing in them?
What does it really mean then? It's an attempt by the FCA to get crypto assets to abide by regulatory guidelines and provide better support for those investing in cryptocurrencies. Specifically, it refers to a ban on companies directly trading cryptoassets without first obtaining approval from the FCA to do so.
Not exactly Pakistan/China-style banning. Besides, this negates the fact that the FCA has, itself, admitted that it has no power to actually enforce these rules on individual retail consumers/investors.
"Marketing ban or a temporary prohibition
3.62 - Restricting the marketing to sophisticated or high-net worth retail clients would
prevent ‘mass marketing’, however, would not mitigate the risks we have identified.
Consumers acting as a result of social media influencers rather than firm marketing are
unlikely to be deterred by this measure.
3.63 - Although a temporary prohibition would address the immediate risk, under MiFIR
powers we can only intervene for a 3-month period. We consider a short-term policy
response to be inappropriate to the identified risks."
In addition to these conclusions made by this consultation. Much as CoinTelegraph pointed out, this proposal does not make reference to other asset classifications such as Security and Utility Tokens. The latter duo being only occasionally subjected to regulatory oversight.
Perspective thus gained, is the UK looking at a broad sweeping 'Crypto Ban'? No. They're looking at improving accountability by restricting access to unregulated coins while professionalising the market.
Even then, CP19/22 exists as a 'consultation' until October 3rd 2019. With the very real possibility of it being amended or even rejected outright.
In the past, Britain has demonstrated a relatively optimistic view of cryptocurrencies. With the outgoing Governor of the Bank of England, Mark Carney, seeing some potential real-use cases for cryptocurrencies, including Facebook's Libra.