Ireland’s central bank is reluctant to allow retail investors to gain access to cryptocurrency funds as it thinks ordinary people aren’t sophisticated enough to invest in digital assets.
The Central Bank of Ireland has stated that it is unlikely to approve investment funds for retail crypto investors because they lack the know-how to navigate the high-risk asset class.described crypto assets as a new product offering in securities markets that is complex and a “potential threat to investor protection.”
Although the bank fielded many queries last year about Alternative Investment Funds regarding crypto, it is now not expected to approve an AIF for retail crypto investors. The bank feels that such investments “may be suitable for wholesale or professional investors,” but are too complicated for small fish:
“The Central Bank is highly unlikely to approve a UCITS or a Retail Investor AIF proposing any exposure to crypto-assets, taking into account the specific risks attached to crypto-assets and the possibility that appropriate risk assessment could be difficult for a retail investor without a high degree of expertise.
Ireland’s Director of securities and markets supervision Patricia Dunne provided some explanation of the bank’s thinking to on Feb. 8, saying there are “too many unanswered questions around things like custody, money laundering, and even just volatility and liquidity” regarding retail crypto investing.
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