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Sam Woods, the deputy governor for prudential regulation and chief executive of the Prudential Regulation Authority, wrote in a letter that “the range of products and market participants related to crypto-assets has grown quickly. In their short history, crypto-assets have exhibited high price volatility and relative illiquidity.”
“Crypto-assets also raise concerns related to misconduct and market integrity — many appear vulnerable to fraud and manipulation, as well as money-laundering and terrorist financing risks. Entering into activity related to crypto-assets may give also rise to reputational risks,” he wrote.
Mr Woods went on to remind businesses of their responsibilities to act in a prudent manner, have effective risk strategies and co-operate with regulators.
The letter went on to say that pay should not incentivise excessive risk-taking and that companies should “conduct extensive due diligence before taking on any crypto-exposure”.
Full article on Financial Times (subscription required)