Nation Should Not Compensate Investors For Crypto Losses, Says UK Financial Conduct Authority CEO – .

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Nation Should Not Compensate Investors For Crypto Losses, Says UK Financial Conduct Authority CEO – .


UK Financial Conduct Authority (FCA) CEO Nikhil Rathi made the following statement to the Treasury Committee when asked about the risks of the country’s very unregulated cryptocurrency industry on Wednesday :

When we talk about the compensation plan, we have to draw fairly clear lines. I would suggest that anything crypto related should not be entitled to offsets, and consumers should be clear about this when investing.

In the passage, Rathi is referring to the FCA Financial Services Compensation System, or FSCS, which pays compensation to consumers when certain authorized financial institutions cannot cope with claims against them, such as in bankruptcies, criminal schemes or breach of insurance contract. In theory, the proposed rules would prevent the UK government from compensating crypto investors who have been scammed by allegedly fraudulent cryptocurrency exchanges or decentralized financial carpet draws, as these types of investments are unregulated or operate in. legal gray areas. Over £ 717 million has been paid to consumers this year by the FSCS in compensation for their financial loss.

Nikhil Rathi speaking at the Treasury Committee hearing | Source : parlementlive.tv

“There are technologies underlying cryptocurrencies, which I think we would recognize as having significant benefits and value, such as fighting financial crime. A number of innovations, however, have raised concerns for us, ”Rathi said when asked about the country’s regulations. framework. “We believe that some of these crypto-assets have no intrinsic value. They have been part of a series of organized crimes and money laundering, and anyone who invests in them must be prepared to lose all of their money. “

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