Miner.farm Crypto Currency Community Forum

Browse and post your favorite coin/crypto news, miner.farm and PiMP OS updates and announcements, mining guides, overclocking tips, and more...

Quick Links


New ESMA Measures Impose 2:1 Restriction on Leverage for Crypto CFDs


  • Staff

    New ESMA Measures Impose 2:1 Restriction on Leverage for Crypto CFDs

    The European Securities and Markets Authority (ESMA) has announced that it will impose restrictions on the leverage offered for contracts-for-difference (CFDs) and binary options offered to European retail investors. Under the new measures, the leverage offered on cryptocurrency CFDs will be limited to no more than 2:1.

    _**Also Read: **PBOC to Strengthen Cryptocurrency Regulations in 2018 _

    European Securities Regulator Imposes Restrictions on Leverage Offered by CFD Providers

    New ESMA Measures Impose 2:1 Restriction on Leverage for Crypto CFDsESMA has agreed on what it describes as “temporary product intervention measures on the provision of [CFDs] and binary options to retail investors in the European Union (EU).”

    The new measures will see restrictions on the leverage offered on cryptocurrency CFDs to no more than 2:1. The agreements will also mandate that traders provide an initial margin of “50% of the notional value of the CFD when the underlying [asset] is a cryptocurrency” – more than twice the initial margin required of any other CFD.

    New Measures See Harshest Rules Imposed on Cryptocurrency CFDs

    New ESMA Measures Impose 2:1 Restriction on Leverage for Crypto CFDsESMA has stated that cryptocurrencies CFDs states that “CFDs with cryptocurrencies as an underlying raise separate and significant concerns as CFDs on other underlying” assets.

    The regulator stated that “Cryptocurrencies are a relatively immature asset class that pose major risks for investors.” ESMA expressed “concerns about the integrity of the price formation process in underlying cryptocurrency markets,” arguing that such “makes it inherently difficult for retail clients to value these products.”

    ESMA concluded that “Due to the specific characteristics of cryptocurrencies as an asset class the market for financial instruments providing exposure to cryptocurrencies, such as CFDs, will be closely monitored.” Based on its findings, ESMA “will assess whether stricter measures are required.”

    New Rules to be Formalised in “Coming Weeks”

    New ESMA Measures Impose 2:1 Restriction on Leverage for Crypto CFDsThe measures will also see restrictions of 30:1 placed on “major currency pairs;” 20:1 for “non-major currency pairs, gold and major indices;” 10:1 for “commodities other than gold and non-major equity indices;” and 5:1 on “individual equities and other reference values.”

    ESMA states that it “intends to adopt these measures in the official languages of the EU in the coming weeks.”

    What is your response to the new restriction on the leverage offered by European CFD providers? Share your thoughts in the comments section below!


    Images courtesy of Shutterstock


    Want to create your own secure cold storage paper wallet? Check our tools section.

    The post New ESMA Measures Impose 2:1 Restriction on Leverage for Crypto CFDs appeared first on Bitcoin News.

    https://news.bitcoin.com/esma-measures-impose-21-restriction-leverage-crypto-cfds/


 



Want 10% more hash from your rigs?



We promise to keep your email safe and never spam you.



© 2014-2020 Miner.farm | By Miners, For Miners | Portable Instant Mining Platform, LLC