Dutch Finance Official Wants to Ban Retail Investors From Trading Crypto Derivatives

Crypto derivatives trading should be restricted to wholesale markets, a senior Dutch financial regulator said recently.

The comments suggest Dutch supervisors want to join the U.K. in banning access to options and futures based on virtual assets for regular retail customers, even if they don’t yet have the power to do so.

“I maintain that the trade in crypto derivatives should be restricted to wholesale trade,” said Paul-Willem van Gerwen, head of Capital Markets and Transparency Supervision at the Dutch Authority for Financial Markets (AFM). He cited the risks of markets that are opaque, and prone to manipulation and other criminal activity.

The comments by van Gerwen were given in a speech last week and posted on the AFM website Tuesday.

Van Gerwen cited restrictions that already have been imposed by the U.K. Financial Conduct Authority in 2020 that effectively limit trading to professional financiers, adding that, in the Netherlands, “we haven’t done so, yet.”

Amsterdam is a hub for many kinds of financial trading – all the more so since, post-Brexit, U.K. venues have been barred from European Union markets.

The AFM has already proposed restrictions on retail trading in more conventional financial instruments such as turbo leveraged products. The AFM doesn't have similar powers over crypto markets, but may acquire them once an EU law known as the Markets in Crypto Assets Regulation (MiCA) takes effect, an AFM spokesperson told CoinDesk.

Van Gerwen said he wanted to see more experiments using distributed ledger technology to support trades, which he said could cut costs. But he warned that there would always need to be centralized authorities in case a transaction gets bungled.

Read more: FCA Bans Crypto Derivatives for Retail Consumers in UK