'Very High Risk': UK Finance Watchdog Issues Statement on ICOs

The U.K.'s Financial Conduct Authority is the latest in a wave of regulators to issue a formal warning on initial coin offerings.

Sep 12, 2017 at 11:30 a.m. UTC
Updated Sep 13, 2021 at 6:55 a.m. UTC

The U.K.'s Financial Conduct Authority (FCA) is the latest in a wave of regulators around the globe to issue a formal warning on initial coin offerings (ICOs).

The FCA states on its website that ICOs constitute "very high-risk, speculative investments," and that, as they are largely unregulated, it may not be able to offer protection of any kind.

The warning urges investors to report any potential scams to the FCA, whilst suggesting the public should "learn more about potential benefits and challenges of the underlying technology that facilitates ICOs" via a link to in-house research on distributed ledger technology (DLT).

The statement follows similar warnings that have emerged from financial regulators internationally, such as U.S. Securities and Exchange Commission, the Monetary Authority of Singapore, the Canadian Securities Administrators, Malaysia's Securities Commission, the Bank of Russia, the People's Bank of China and the Securities and Futures Commission of Hong Kong.

China's financial regulators also issued a full ban on ICOs earlier this month, in a statement which has been fully translated by CoinDesk here.

UK Justice Court image via Shutterstock

The Festival for the Decentralized World
Thursday - Sunday, June 9-12, 2022
Austin, Texas
Save a Seat Now

DISCLOSURE

Please note that our privacy policy, terms of use, cookies, and do not sell my personal information has been updated.

The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups. As part of their compensation, certain CoinDesk employees, including editorial employees, may receive exposure to DCG equity in the form of stock appreciation rights, which vest over a multi-year period. CoinDesk journalists are not allowed to purchase stock outright in DCG.

Trending

1
Indian Central Bank Says Cryptos Could Lead to "Dollarization" of Economy: Report

RBI officials said cryptocurrencies could undermine the central bank's capacity to regulate flow of money.

RBI officials said cryptocurrencies could undermine the central bank's capacity to regulate flow of money.

2
Nigeria’s SEC Affirms All Digital Assets Are Securities in New Rulebook

Rules look to clarify crypto’s role in the economy by providing a regulatory framework.

Rules look to clarify crypto’s role in the economy by providing a regulatory framework.

3
First Mover Asia: Singapore’s Regulators Will Be Eyeing Local Crypto Companies After Terra Collapse; Bitcoin Rebounds

Terraform Labs, the Singapore-registered company behind the Terra protocol, doesn’t have a permanent office in the city-state; most major cryptos spent Sunday in the green.

Terraform Labs, the Singapore-registered company behind the Terra protocol, doesn’t have a permanent office in the city-state; most major cryptos spent Sunday in the green.

4
At Nationals Ballpark, Terra’s Bad Week Never Happened

Terra’s pricey Nationals sponsorship hasn’t made an impact on “Terra Club” workers and fans.

Terra’s pricey Nationals sponsorship hasn’t made an impact on “Terra Club” workers and fans.