UK FCA Grants Crypto Firms Ad Rule Extension: Report

The United Kingdom Financial Conduct Authority (FCA) has extended the deadline for crypto firms to implement the strict marketing rules designed to protect consumers.

Furthermore, An official release states that the core rules will take effect on October 8, 2023. Starting January 8, 2024, they can introduce measures requiring advanced technical development, such as implementing a 24-hour cooling-off period.

The Financial Conduct Authority (FCA) classifies cryptocurrencies as high-risk investments. They advise individuals to be prepared for losing all their funds when acquiring such assets. Moreover, the regulatory body mandates clear risk warnings in promotional materials for crypto to protect UK investors.

An autho­rized firm is responsible for approving all public promo­tions to ensure they are not misle­ading or inappro­priately incent­ivizing people to invest. These rules apply unive­rsally to global firms and aim to enhance consumer prote­ction against risks assoc­iated with crypto assets.

UK Crypto Regulations: Deadline Looms For Firms

However, Crypto companies that fail to implement the rules by the October 8 deadline and continue promoting digital assets to UK users will face severe consequences. These consequences include an unlimited fine or up to two years of imprisonment.

Starting in October, UK crypto firms must market transparently to consumers, says Lucy Castledine, Director of Consumer Investments. These firms need to provide risk warnings that are easily compreh­ensible to people. As a regulator, we prioritize proportionate measures. They grant firms extra time for technical and business reforms’ proper implementation. Throughout this extended period, close monit­oring will be maintained on these firms.

Crypto firms can request permission for more flexibility through technical measures. These measures include a 24-hour cooling period, client appropriateness testing, and categorization features.

The deadline for these requests is January 2024. From October 8 onwards, the FCA has pledged to take action against crypto companies that engage in illegal marketing targeting UK users.

CEO Steve Rosenblum, the co-founder of Liberty, an AI crypto risk platform, acknowledges the changing dynamics in the cryptocurrency industry. Self-interest wanes. He stresses the UK regulatory shift towards safeguarding retail investors’ interests is rapid and significant.

Related Reading | G20 Pushes for Global Crypto Aseet Oversight with CARF Framework

Rosen­blum, in a statement to Crypto­Potato, highlighted the UK’s ongoing notable transfo­rmation. He stressed the criminality of promoting digital services/products without ensuring customer suitability.