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Keeping into consideration the high risk involved in digital assets and ‘not much expertise’ of retail investors, the central bank of Ireland money put its concern
Thursday’s report consists of the Central Bank of Ireland news stating that it’s not safe for retail investors to put their hard-earned money into highly risky and volatile investments like digital assets and crypto.
Central Bank of Ireland news
Recent report titles with Securities Markets Risk Outlook Report: A Changing Landscapes is for February 2022 volume. That explained crypto-based funds in crypto assets, a new product for offering in securities markets, but that also possesses a potential threat to the protection of investors, especially the smaller ones.
Although it’s not the first time, the bank refused. In December reports on UCITS and AIFs, Central Bank of Ireland money suggested that crypto based funds are for investors with a high degree of expertise, not for small scale investors who lack it.
Solving queries about crypto Alternative Investment Funds, the Bank of Ireland money did not seem to approve AIF for retail small scale investors. Bank’s perspective about crypto-based funds might be suitable for professional investors with expertise but not easy, rather complex for small fishes (investors).
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The official statement
The Ireland Central Bank is very unlikely to approve a UCITS Undertaking for the Collective Investment of Transferable Securities or AIF for Retail Investors, which provide exposure to top funds in crypto, considering the involved risks. So that the risk can be assessed, which is not a piece of cake for retail investors who don’t have enough expertise.
Ireland Central Bank’s Director of securities and markets supervision, Patricia Dunne, said the bank’s thinking towards crypto-based funds is that there are so many questions and queries remaining unsolved related to custody, money laundering and on top of all its volatility and liquidity. Keeping in view the safeguarding of retail investors, they should stay away from total crypto funds.
However other European countries hold different opinions about crypto and its regulation. For instance, one day before the Russian government implemented a regulation after which the trader will be allowed in the country to trade crypto-based funds. Also if transaction value crosses $8000 then only there will be need to mention about the declaration of transaction in cryptocurrencies.