UK Wealth Managers Call for Regulators to Crack Down on Crypto

Executives at Wealthify, Nutmeg, and Scalable Capital have called on the UK’s Financial Conduct Authority (FCA) to take a tighter stance on cryptocurrency regulations, warning that unsuspecting crypto users are at risk of losing their money.

While wealth managers are currently closely regulated by the FCA, Cryptocurrencies Cryptocurrencies By using cryptography, virtual currencies, known as cryptocurrencies, are nearly counterfeit-proof digital currencies that are built on blockchain technology. Comprised of decentralized networks, blockchain technology is not overseen by a central authority.Therefore, cryptocurrencies function in a decentralized nature which theoretically makes them immune to government interference. The term, cryptocurrency derives from the origin of the encryption techniques that are employed to secure the netw By using cryptography, virtual currencies, known as cryptocurrencies, are nearly counterfeit-proof digital currencies that are built on blockchain technology. Comprised of decentralized networks, blockchain technology is not overseen by a central authority.Therefore, cryptocurrencies function in a decentralized nature which theoretically makes them immune to government interference. The term, cryptocurrency derives from the origin of the encryption techniques that are employed to secure the netw Read this Term remain virtually untouched by the regulator.

”The FCA is Way Too Slow”

“The FCA is way too slow,” said Richard Theo, Wealthify CEO and founder, in a report by the Financial News. “[As a regulated firm] there are a lot of tests we have to do before we can take on a client. But that same client can go and buy bitcoin with no questions asked. There are far more risks involved when investing in Bitcoin. The FCA should get on to it fast.”

Founder and CEO of Scalable Capital, Simon Miller, echoed Theo’s statements: “People see the explosion of digital currencies and say ‘I can make a lot of money quickly.’ But that’s not investing — that’s gambling. It needs to be looked at.” He also noted that extensive media coverage of cryptocurrencies might have contributed to the crypto craze, saying that news coverage of traditional asset classes is “not as sexy.”

Indeed, head of exchange-traded fund research at Nutmeg James McManus said that “With cryptocurrencies gaining media attention for large gains but little to no attention for large losses, perhaps now is the time for regulators to take a closer look at the selling process around cryptocurrencies.”

The three men denied that their concern stemmed from the fact that they may be losing customers to cryptocurrency.

Crypto Industry Insiders Want More Regulation, Too

Call for UK regulators to ramp up their efforts hasn’t only come from outside the cryptocurrency industry. Ryan Zagone, head of Ripple’s regulatory relations, said in a Telegraph report earlier this year that the industry is “at that time now where [it needs] more clarity and rules and (...) more certainty.”

“It’s a good time to start revisiting that ‘wait and see’ ­approach taken by regulators,” he added.

Greatly appreciate the invitation and opportunity to brief @UKParliament @CommonsTreasury on digital currencies. Excellent questions and well informed views from Members. See the full video: https://t.co/82A9Jmqwop

— Ryan Zagone (@RyanZagone) May 2, 2018

Similarly, a self-regulatory body for the Blockchain Blockchain Blockchain comprises a digital network of blocks with a comprehensive ledger of transactions made in a cryptocurrency such as Bitcoin or other altcoins.One of the signature features of blockchain is that it is maintained across more than one computer. The ledger can be public or private (permissioned.) In this sense, blockchain is immune to the manipulation of data making it not only open but verifiable. Because a blockchain is stored across a network of computers, it is very difficult to tampe Blockchain comprises a digital network of blocks with a comprehensive ledger of transactions made in a cryptocurrency such as Bitcoin or other altcoins.One of the signature features of blockchain is that it is maintained across more than one computer. The ledger can be public or private (permissioned.) In this sense, blockchain is immune to the manipulation of data making it not only open but verifiable. Because a blockchain is stored across a network of computers, it is very difficult to tampe Read this Term industry known as CryptoUK was created to work hand-in-hand with UK regulators. Chairman Iqbal Gandham described the organization as a body “which the masses and the wider audience in the UK would understand in terms of what crypto is, how we want to regulate it, and what the best practices that we as organizations choose to follow.”

So far, no drastic has been taken to regulate cryptocurrencies within the UK.