Senior executives from three of the leading British wealth manager companies, Wealthify, Scalable Capital and Nutmeg, have called on the financial regulator, the Financial Conduct Authority or FCA, to act in the cryptocurrency market and to protect investors from unstable digital coin prices, local media reported on Thursday.
While rejecting the idea that they are losing clients to crypto, the three consultancies claimed wealth investors are at risk of losing money due to the lack of rules in the crypto world. Richard Theo, chief executive and founder of Wealthify, the UK founder and CEO of Scalable Capital Simon Miller, and James McManus, who is the investment manager and head of exchange-traded fund research at Nutmeg gave in an interview to FN newspaper.
“Is it right for a retail client to go on a DIY platform to buy bitcoin? No, arguably not. 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,” Miller said.
The FCA regulates the wealth management companies, but cryptocurrencies are relatively untouched by the legal framework in the UK. FCA has issued several digital coin warnings, including one for derivative products and an open letter to bank executives.
“The FCA is way too slow. [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,” Miller said.
McManus accused media of not covering cryptocurrency frauds and price declines:
“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.”
Last month, the World Wealth Report by Capgemini revealed that wealthy people are willing to invest in cryptocurrencies but wealth management firms aren’t eager to help them.
This article appeared first on Cryptovest
