FCA Held Talks on Easing the 2019 Ban That Blocks Prediction Markets
The FCA has reportedly held discussions about easing its 2019 ban on retail access to financial prediction markets, though no rules have changed.
Why it matters
The story is significant for the crypto prediction markets space as UK regulatory easing could open a major market. However, since no rules have actually changed and only one outlet is reporting the talks, the practical impact remains speculative. The significance is limited pending concrete regulatory action.
Key facts
The FCA has held talks with trading platforms about easing its ban on retail access to financial prediction markets.
Reported by Unchained
No rule has changed regarding the FCA's ban on retail access to financial prediction markets.
Reported by Unchained
The FCA banned selling, marketing, or distributing binary options to retail consumers effective April 2, 2019.
Reported by Unchained
The FCA estimated the ban would save retail consumers up to £17 million a year.
17,000,000 GBPReported by Unchained
Christopher Woolard, then FCA executive director of strategy and competition, called binary options gambling products dressed up as financial instruments.
Reported by Unchained
Industry participants have reportedly lobbied for change, presenting evidence that millions of Britons use overseas platforms via VPNs.
Reported by Unchained
The FCA's perimeter report from March lists non-financial prediction markets as outside its remit and financial ones as subject to the permanent ban.
Reported by Unchained
What happened
Britain's Financial Conduct Authority has held talks with trading platforms about potentially easing its ban on retail access to financial prediction markets, according to The Times. The FCA treats contracts referencing financial and certain climatic events as binary options, which have been prohibited for UK retail consumers since April 2, 2019. The regulator estimated the ban would save retail consumers up to £17 million annually and characterized binary options as gambling products disguised as financial instruments. Industry participants have reportedly lobbied for change, presenting officials with evidence that millions of Britons already use overseas platforms via VPNs, placing them outside UK protections. However, no rule has changed and the FCA's published position still supports the prohibition. The FCA's own perimeter report from March lists prediction market products on non-financial events as outside its remit and states that financial prediction markets it has seen remain subject to the permanent retail ban.
How the story developed
- Update
The Times reported FCA held talks on easing prediction market ban
The Times reported that the FCA held talks with trading platforms about easing its 2019 ban on retail access to financial prediction markets.
- First report
First report by Unchained
FCA Held Talks on Easing the 2019 Ban That Blocks Prediction Markets
- Official statement
FCA ban on binary options for retail consumers takes effect
The prohibition on selling, marketing, or distributing binary options to retail consumers came into force.
- Official statement
FCA published perimeter report addressing prediction markets
The report listed non-financial prediction markets as outside FCA remit and financial ones as subject to the permanent ban.
Affected entities
Original sources
| Publisher | Report | Role | Published |
|---|---|---|---|
| Unchained Crypto media | FCA Held Talks on Easing the 2019 Ban That Blocks Prediction Markets | Original |
Related events
Ether and XRP ETFs post outflows as crypto majors move higher
Live updates: Bitcoin climbs over $80,000 as crypto shakes off Clarity failure and higher interest rates
SEC Grants Five-Year Exemption Allowing Tokenized US Stocks to Trade on Permissioned AMMs
The SEC approved a five-year Innovation Exemption letting Tokenized Securities Venues trade tokenized US stocks via permissioned automated market makers without registering as exchanges.
