Released 06 September 2021
The Chair of the Financial Conduct Authority (FCA), Charles Randell, delivered a speech at the Cambridge International Symposium on Economic Crime, in which he warned about the risks of token regulation.
Randell said while platforms’ efforts to crack down on fraudulent advertisements are welcome, a permanent and consistent solution to the problem of online fraud from paid-for advertising requires legislation. Speculative crypto tokens are not regulated by the FCA and consumers are not covered or protected by the Financial Services Compensation Scheme in the event of losses.
Randell suggested that legislators need to consider:
•how to make it harder for digital tokens to be used for financial crime;
•how to support useful innovation; and
•the extent to which consumers should be free to buy unregulated, purely speculative tokens and to take the responsibility for their decisions to do so.
The full speech can be found at https://www.fca.org.uk/news/speeches/risks-token-regulation.