Crypto-Promoting Businesses Have Already Broken FCA’s Rules 221 Times

Jimmy Aki
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Despite taking a tough stand against the illegal promotion of crypto assets in the United Kingdom (UK), the Financial Conduct Authority (FCA) says it has not seen any significant improvement.

146 Alerts in One Day

According to an October 25 statement on its website, the UK’s financial watchdog noted that crypto-promoting firms had breached its promotional rules 221 times in less than three months. This follows a growing number of fraudulent activities in the cryptocurrency space.

According to the UK regulator, this latest warning comes after it sent 146 alerts to crypto businesses on October 9, just one day after the introduction of new cryptocurrency promotional guidelines on October 8.

Providing more context, the regulator explained that these businesses failed to present sufficiently clear risk warnings and comprehensive information regarding the potential hazards of engaging in digital asset transactions.

The crypto risk warnings were displayed in small fonts, using hard-to-read color schemes, or were positioned inconspicuously.

Instead of addressing the issues pointed out through the FCA’s alerts, these blockchain-based businesses elaborated on the safety, security, or user-friendliness of cryptocurrency assets without adequately addressing the inherent risks.

In an effort to disseminate this message to UK residents, the FCA has taken to its official X (formerly Twitter) handle, sharing a blog post highlighting common issues related to cryptocurrency marketing.

The UK has become a major hub for digital asset trading in recent years. While the government has been welcoming, it has taken intentional steps to educate residents about the potential risks involved.

Only Work With FCA Compliant Services

Crypto firms have been the target of several regulatory oversight in the last few months. More world governments are implementing rules to make the space safer for investors. The FCA is one such agency.

In its new promotional rules for cryptocurrencies, adverts for crypto assets can only be approved by firms that comply with the regulator’s rules. This stipulation is meant for all businesses operating within the UK. The rule also applies to crypto companies outside the UK but with customers in the region.

These businesses are also to make prominent warnings on these promotions. In addition, referral bonuses and memes are banned in the UK.

Meanwhile, UK lawmakers are taking steps to combat illicit activities in the nascent industry. According to a new bill, law enforcement agencies will now be able to seize crypto assets used in fraudulent activities.

About Jimmy Aki PRO INVESTOR

Based in the UK, Jimmy is an economic researcher with outstanding hands-on and heads-on experience in Macroeconomic finance analysis, forecasting and planning. He has honed his skills having worked cross-continental as a finance analyst, which gives him inter-cultural experience. He currently has a strong passion for regulation and macroeconomic trends as it allows him peek under the global bonnet to see how the world works.