The UK’s Financial Conduct Authority (FCA) has raised concerns over the growing number of young investors under 35 turning to cryptocurrencies as their first financial investment.
FCA Chief Executive Nikhil Rathi warned that these assets are highly risky, with the potential for total financial loss.
Speaking to MPs, Rathi noted that direct share ownership in the UK remains significantly lower than in countries like the US and Sweden. As part of the FCA’s five-year strategy, he stressed the importance of encouraging greater investment in shares and bonds to promote long-term financial stability.
He further highlighted the need to shift young investors’ focus away from crypto and toward more traditional financial products.
“One thing I think is not great is the sheer number of under 35-year-olds for whom the financial product that they invest in first is crypto—several million in the UK—rather than equities, debt, or other types of products,”
Rathi said.
Despite these concerns, FCA research indicates that UK citizens’ awareness of cryptocurrencies is growing. A recent survey found that 93% of respondents are now familiar with crypto, up from 91%, while crypto ownership has risen to 12% of UK adults, compared to 10% in previous findings.
Rathi attributed the country’s historically low level of share ownership to a combination of tax policies, education, regulation, and broader cultural factors. To address this, he emphasized that the FCA’s new strategy aims to “deepen trust, rebalance risk, support growth, and improve lives.” He also noted that the regulator is exploring emerging technologies like AI to enhance its efficiency in supporting economic growth through investment opportunities.
Meanwhile, The FCA’s ban on crypto derivatives has faced criticism from industry leaders, including Joshua Barraclough, CEO of One Trading. He described the ban as “terrible,” arguing that it ultimately harms consumers by restricting their ability to make informed investment decisions, even when those decisions carry risks.
