The Financial Conduct Authority’s (FCA) newly established marketing and promotion crypto regulations has already raised 146 alerts.
From 8 October 2023, crypto and digital asset firms will be required to comply with the new regulations designed to protect customers from potentially being misled into investing into cryptocurrencies and other digital assets.
To give consumers and possibly companies further clarity, the FCA has set up a Warning List and has implored those interested in making investments in the crypto market to read through it to understand which promotions may be breaking the law.
An FCA statement read: “We expect businesses including social media platforms, app stores, search engines, domain name registrars and payments firms to consider the alerts we have issued and play their part in protecting UK consumers from illegal promotions.
“We take a risk-based approach, so not all firms of potential concern will be added straight away. This list will be continually updated as we identify firms which may be illegally communicating cryptoasset promotions and are failing to engage with us constructively.
“We also continue to remind people that purchasing cryptoassets remains high-risk and that they should be prepared to lose all their money.”
The UK financial regulator has unveiled four approved routes for cryptoasset firms to tame to communicate promotions:
- An authorised person communicates the promotion
- An authorised person approves the promotion
- A crypto firm registered under the Money Laundering Regulations communicates the promotion
- The promotion otherwise complies with the conditions of an exemption in the Financial Promotion Order
The FCA has warned companies that failure to comply with the new promotion and marketing crypto rules could result in up to two years imprisonment.