The Financial Conduct Authority (FCA) of the United Kingdom has announced stricter regulations for advertisers of cryptocurrency services in the country. Starting from October 8, crypto companies will be required to implement a “cooling-off period” for first-time investors. The FCA has also prohibited the use of “refer a friend” bonuses by firms in the sector as part of measures to enhance investor awareness of risks.
The new regulations aim to address impulsive decision-making and provide individuals with sufficient time and appropriate risk warnings to make informed choices. Crypto companies will need to verify that investors possess the necessary knowledge and experience for engaging in crypto investments. Advertisers promoting cryptocurrencies must provide transparent risk warnings and ensure their advertisements are fair, clear, and free of misleading information.
The FCA’s rules align with government legislation aimed at subjecting crypto promotions to regulatory oversight. This development highlights the ongoing scrutiny faced by the crypto industry, particularly in light of regulatory crackdowns in other jurisdictions, such as the United States, where the Securities and Exchange Commission (SEC) has filed lawsuits against Binance and Coinbase.
In August 2022, the FCA implemented stricter regulations for deceptive advertisements related to high-risk investment products, but these measures did not initially include cryptocurrencies. The recent announcement extends the FCA’s oversight to crypto advertisements, bringing them in line with the restrictions implemented last year for promoting high-risk investments. The FCA is also seeking feedback on additional guidelines for crypto advertisers, with a consultation process open until August 10.
Get $200 Free Bitcoins every hour! No Deposit No Credit Card required. Sign Up