In a speech at the FCA’s “Our Role and Business Plan webinar”, Rathi said there has been a huge increase in young investing, but it was led by riskier investments such as cryptocurrencies. Rathi said the regulatory body is planning to run an 11 million GBP (Rs 113.4 crore) digital marketing campaign to warn them against the risks.
According to research published by the FCA last year, around 2.5 million people in the United Kingdom held crypto assets. The latest analysis, Rathi said in her speech, shows that “goers” to digital currency were not only comparatively younger, but were, proportionately, more likely to be an ethnic minority. He said there is evidence to confirm that, like in GameStop episodes, more people viewed investing as entertainment and were therefore behaving less rationally and more emotionally.
Although the cryptocurrency market has a lot of income potential through smart investments. But it certainly needs to be done systematically, even as some proponents keep talking about “holding forever”. Investors need to learn about the risks, and do their own research. So that if they are investing their money, they do so in a smart and planned way.
Speaking about the risks associated with the crypto market, Rathi said that they are “stringent”, with the body repeatedly clarifying that investors should be prepared to lose all their money. Interestingly, this all comes just a day after Dodgecoin co-creator Jackson Palmer said he would never return to cryptocurrency. adding that it was an “inherently right-wing, hyper-capitalist technique”.
On the other hand, Rathi said that as technology confronts the increasing number of consumer freedoms, we will be faced with decisions and trade-offs that we have not seen before. Not only this, he added that deeper ethical questions, especially with the increasing use of machine learning artificial intelligence to target consumers, will also come before us. Having said that, Rathi said that we should be more open about it. “We also need to communicate clearly that these are questions not just for the regulators but for the society – Parliament and the government,” he said.
On its website, the FCA said it is the conduct regulator for approximately 51,000 financial services firms and markets in the UK and the prudent supervisor for 49,000 firms, setting specific standards for approximately 18,000 firms. Established on 1 April 2013, this body aims to work well not only for its members, but also for individuals, for businesses, large and small, and the economy as a whole.