Britain’s Financial Conduct Authority (FCA) has issued hundreds of alerts regarding companies “illegally promoting crypto assets to U.K. consumers.” The regulator also highlighted several “common issues” with crypto promotions it has identified since it imposed stricter marketing rules earlier this month.
U.K.’s Financial Watchdog Vows to Remove ‘Illegal’ Crypto Marketing Content
Businesses that wish to promote crypto assets in the U.K. are now required by law to register with the FCA and obtain authorization or use the services of a firm authorized to approve marketing materials. The obligation, part of new rules introduced in June, was enforced on Oct. 8.
Since then, the financial regulator has been supervising crypto companies for their compliance with the new regime that was supposed to provide consumers with sufficient information to understand what they are investing in and be properly warned about the relevant risks.
On Wednesday, the FCA said it had identified three common issues with financial promotions involving cryptocurrencies. These include promotions not highlighting the risks involved, risk warnings that are not clearly visible, and failure to provide adequate information about the risks associated with specific products. The authority emphasized:
In the case of non-compliance, we will take robust action to remove illegal content to protect consumers.
The FCA also said it’s continuing to identify and take action against firms that are illegally promoting crypto assets to U.K. residents. The agency has already issued 221 alerts about such companies and urged consumers to check its warning list before putting money into crypto.
“We expect authorized firms approving the financial promotions of crypto asset firms to take their regulatory obligations seriously. Where this is not happening, we will take action and have already placed restrictions on an authorized firm to restrict it from approving crypto asset financial promotions,” the watchdog noted.
The Financial Conduct Authority was referring to the case of Rebuildingsociety.com, a platform which was hired by the world’s largest crypto exchange, , to review its marketing materials in the U.K. Days after Binance announced its partnership with the FCA-authorized firm, the latter was ordered to withdraw any approvals of financial promotions on behalf of crypto businesses. As a result, Binance had to stop accepting new users in the U.K.
Do you think the U.K.’s new crypto promotion rules and the FCA’s actions will affect many more companies in the sector? Share your thoughts on the subject in the comments section below.
