“Gamification” in the financial markets under scrutiny, says EU Watchdog

London — Gammification introduced a new generation of retail investors to financial markets that may be unaware that there is little protection for assets like cryptocurrencies, the European Union Securities Watchdog said on Tuesday. Told.

Gamification refers to trading using a smartphone. It became popular on Wall Street when the COVID-19 pandemic occurred in apps such as Robin Hood and spilled over into the European market.

At the Forum Europe Financial Services Conference, European Securities and Markets Authority Chairman Belena Ross said, “We want investors to be more involved in the financial markets, not just deposit money under the mattress.” Said.

But gamification also poses significant risks, creates speculation, and leaves investors unaware of the protection they have when trading markets like crypto assets, she said.

Social media has also allowed the spread of unauthorized trading advice, and Brock plans to revamp its “retail investor” strategy this year to reflect the rise of digital finance, Ross said.

“We are looking at ways to raise awareness and warn investors what they want,” Ross said.

Brock has already proposed to ban “payment of order flows” in the retail market.

However, EU regulators are faced with a balanced move to protect investors while prospering private investment in areas that have long supported savings products.

The block encouraged the UK’s departure from the EU to deepen its capital markets to encourage companies to issue shares and raise funds rather than relying on banks.

Alexandra Jour-Schroeder, a senior European Commission official in the financial services sector, said “it’s a hassle” because blocks are “much behind” other jurisdictions in helping companies raise money in the market. He said the listing rules would be reformed.

But Barclays Europe CEO Francesco Seccato said more is needed to harness the EU’s huge savings to green the economy.

“What we really need is to put together greater political support, centered on what could be a bit more radical in some places, to create a equitable culture in the EU,” Ceccato said. Says.

Hugh Jones