The Financial Conduct Authority’s Efforts to Combat Illegal Cryptoasset Promotions
The Financial Conduct Authority (FCA) has released a report detailing its focus on preventing illegal cryptoasset promotions targeted at UK consumers. Over the past year, the regulator issued 2,285 alerts to protect consumers from scams, with 450 specifically addressing illegal cryptoasset promotions in Q4 2023. In total, the FCA withdrew or amended over 10,000 financial adverts and promotions, marking a 17% increase compared to the previous year.
Enforcement Actions Taken by the FCA
The FCA took enforcement actions against firms that failed to comply with financial promotion regulations. For example, it targeted a firm offering qualifying cryptoassets that had not identified web pages constituting financial promotions. Additionally, the FCA provided feedback to a cryptoasset firm that lacked a clear control framework for promotions made by its affiliates.
FCA’s Financial Promotion Regulations for Cryptoassets
The FCA’s financial promotion rules for cryptoassets were implemented on October 8, 2023. These guidelines emphasize the importance of clear and fair promotions that are not misleading. Companies must display risk warnings and disclose their regulated status when promoting financial products. The FCA also expressed concern about influencers promoting financial products and stated its commitment to intervening and taking action against firms that do not meet its standards.
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