Free Airdrop Season 7 is LIVE! Answer fun questions or do simple tasks to earn rewards from the $30K BitDegree prize pool. Participate Now ! 🔥
Key Takeaways
Free Airdrop Season 7 is LIVE! Answer fun questions or do simple tasks to earn rewards from the $30K BitDegree prize pool. Participate Now ! 🔥
The UK’s Financial Conduct Authority (FCA) is planning new rules that would stop regular investors from using borrowed money to buy cryptocurrencies.
David Geale, the FCA’s executive director for payments and digital finance, reportedly stated that while crypto could offer new opportunities for the UK, the industry must have proper protections.
He added that the FCA is not against crypto but sees it as a high-risk area where consumers need more safeguards.
Did you know?
Subscribe - We publish new crypto explainer videos every week!
What are dApps in Crypto? (Explained with Animations)
On May 2, the FCA asked for public feedback on crypto regulation. In its consultation, the regulator said it is considering a rule to stop companies from allowing customers to buy crypto with credit.
The FCA aims to apply stricter standards to services aimed at everyday investors compared to those serving professional clients. According to Geale, the goal is to create a safe and competitive environment that also attracts responsible businesses to the UK.
One major reason for banning credit-based crypto purchases is the risk of people taking on debt they cannot repay if the value of their crypto drops. FCA research from 2024 found that 72% of crypto users use their own money to invest. However, purchases using credit have increased from 6% in 2022 to 14% in 2024.
Other possible rules include stopping regular investors from using crypto lending and borrowing services. Exchanges may be required to treat all trades equally, clearly report pricing and trade execution, and separate their own trading from customer trading. Paying intermediaries for sending orders could be banned. Staking services might have to cover losses caused by third parties.
Recently, the European Union confirmed plans to introduce strict anti-money laundering rules. What do the rules entail? Read the full story.
To ensure the highest level of accuracy & most up-to-date information, BitDegree.org is regularly audited & fact-checked by following strict editorial guidelines & review methodology.
Carefully selected industry experts contribute their real-life experience & expertise to BitDegree's content. Our extensive Web3 Expert Network is compiled of professionals from leading companies, research organizations and academia.