FCA struggles with crypto ads as UK looks to encourage crypto compliance
The United Kingdom faces mounting challenges in regulating crypto advertising as the Financial Conduct Authority (FCA) grapples with widespread violations, the Financial Times reported on Jan. 1.
According to the report, the FCA issued 1,702 alerts against potentially misleading crypto ads between October 2023 and October 2024, yet only 54% resulted in content removal.
Despite the regulators authority to fine or prosecute violators, the FT states that it has focused much of its recent efforts on social media influencers promoting risky financial schemes. According to the report, nine individuals, including reality TV stars, are facing criminal charges, with investigations ongoing for 20 others.
However, the FT reported that former FCA chair Charles Randell emphasized the importance of more vigorous enforcement. He argued that visible legal actions against offenders, including tech platforms and crypto exchanges, are necessary to reduce the current high levels of non-compliance.
The FCAs rules aim to safeguard investors by requiring firms to warn about the risks of losing their entire investment and banning referral bonuses. These measures have already had an impact, notably preventing Binances local partner, Rebuildingsociety.com, from approving promotional material in 2023.
UKs crypto regime
These enforcement issues come as the UK prepares to introduce a robust crypto regulatory framework in early 2025. This new framework addresses oversight challenges in areas like stablecoins, staking, and digital asset services.
The FCA has already launched a public consultation to refine these upcoming regulations. The initiative targets market manipulation, financial fraud, and unclear disclosures, aiming to restore consumer trust in the sector.
Industry experts believe these steps are crucial for the UKs competitiveness in the rapidly evolving crypto space.
The government hopes to attract investment and drive economic growth by creating a balanced and forward-looking framework. However, failure to act decisively risks leaving the country behind its global peers, such as the United States.
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Text source: CryptoSlate
