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Bitcoin prices rallied on Monday to hit a fresh record high above $71,000, after the British financial watchdog said it would allow exchanges to list cryptocurrency-linked exchange-traded products for the first time.
The Financial Conduct Authority said in a notice Monday that it would not object to requests from recognized investment exchanges to create a U.K.-listed market segment for crypto-backed exchange traded notes, or ETNs.
Exchanges would need to ensure they have sufficient controls in place, so that trading is orderly and proper protection is afforded to professional investors. They must meet all the requirements of the U.K.’s listings regime, issuing prospectuses and ongoing disclosures.
Bitcoin’s price surged over 3% to $71,726.49 at around 4:30 a.m. ET, hitting a fresh all-time high. Ether climbed nearly 2%, to $4,014.90.
The London Stock Exchange acknowledged the FCA’s statement Monday, saying in a separate statement that it would accept applications for the admission of bitcoin and ether ETNs from the second quarter of this year.
The FCA clarified that only professional investors would be able to buy ETNs. The U.K. currently doesn’t allow retail investors to buy crypto-linked ETNs or derivatives, as it says they are too risky for consumers.
The FCA said it continues to believe cETNs — crypto ETNs —and crypto derivatives are “ill-suited for retail consumers due to the harm they pose.”
It noted, “As a result, the ban on the sale of cETNs (and crypto derivatives) to retail consumers remains in place.”
The FCA added it “continues to remind people that cryptoassets are high risk and largely unregulated. Those who invest should be prepared to lose all their money.”
Why it’s a big step for crypto
The move from U.K. regulators comes after their U.S. counterparts approved the first-ever spot bitcoin exchange-traded funds.
The Securities and Exchange Commission gave the green light for ETFs from BlackRock, Fidelity,…
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