- The FCA has underscored its authority over crypto promotions in the UK.
- The regulator raised “common issues” observed since a new marketing regime went into effect.
- The financial watchdog shared an updated “alert list” for non-compliant entities.
The UK’s financial watchdog has sounded a warning over what the regulator terms “common issues” in crypto promotion following a new digital assets marketing regime that took effect on October 8.
On October 25, the FCA released an official statement reiterating that the October 8 legislation amendment brought crypto assets promotions and its remit and noted concerns about certain firms failing to give consumers the right information and risk warnings.
Common Issues in Crypto Assets Financial Promotions
Per the FCA’s statement, since the new marketing regime was promulgated, the regulator has observed and identified three common issues with crypto asset financial promotions.
The regulator complained about firms that fail to highlight sufficient risk warnings associated with the crypto products they promote, adding that some disclaimers weren’t visible enough due to non-prominent positioning of the message, small fonts, or hard-to-read coloring.
The FCA also raised concerns about dubious claims on the “safety” of using crypto assets without specifying the perils involved in such activity, warning that such deliberate misrepresentations could result in severe consequences.
“We expect authorized firms approving the financial promotions of cryptoasset 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 cryptoasset financial promotions,” the statement read.
Notably, the regulator averred that the FCA is working with other stakeholders to limit UK consumer exposure to crypto firms issuing illegal promotional statements.
Updated Warning List
In the statement, the FCA confirmed that it was actively engaging several businesses, including app stores, domain name registrars, and social media platforms, to remove or block illegal crypto promotions.
Specifically, the regulator urged users to check its updated warning list for non-compliant firms before making any crypto investment. Since the regime took effect, the number of firms on the alert list has grown to 221.
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