The U.K.’s financial regulator, the Financial Conduct Authority (FCA), proposed allowing certain retail investment funds to hold up to 10% of their assets in cryptocurrency exchange-traded notes (ETNs).

The financial regulator made the suggestion for UCITS (“Undertakings for Collective Investment in Transferable Securities”) schemes and some non-UCITS retail schemes (NURS) to invest in crypto ETNs in its latest quarterly consultation paper.

UCITS and NURS are similar to mutual funds in the U.S. in that they are regulated, open-ended structures that pool money from retail investors into managed portfolios.

“Our proposed 10% limit for UCITS and NURS would also mitigate the risk of significant impacts arising from crypto ETN exposure,” the…