The Financial Conduct Authority (FCA) got busy as soon as the crypto marketing regime came into force. 146 alerts were issued on the first day.
New Promotions Regime
The UK is a country that is looking to welcome crypto companies to its shores. However, these companies will need to comply with very stringent regulations, and the new crypto asset promotions regime acts as a warning to the public and all businesses of illegal promotions in the crypto sector.
According to a report published on the Financial Conduct Authority’s own website, consumers should check its new “Warning List” before making any crypto investments. The FCA advisory report stated:
“The list will help consumers understand where firms' promotions may be breaking the law and to consider the promotion with the full information available.”
The FCA added in its report that the List would be updated as time went on, but that it had decided to adopt a “risk-based approach” so that crypto companies that the agency deemed to be high risk would go on to the list first, and other companies would be added if they were not complying with the Regime, and also if they were not engaging “constructively” with the regulator.
Routes to compliance
In the “Further Information” section of the advisory report, the FCA laid down 4 possible routes that crypto companies could use in order to promote crypto. There are:
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1. An authorised person communicates the promotion.
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2. An authorised person approves the promotion.
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3. A crypto firm registered under the Money Laundering Regulations (MLR) communicates the promotion.
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4. The promotion otherwise complies with the conditions of an exemption in the Financial Promotion Order.
The FCA finished by affirming that it had been warning crypto companies since February this year of these coming changes, and that a letter had been put out that highlighted the deadline so that companies could prepare their compliance strategies.
The missive from the FCA ended with the following no-nonsense statement:
“In the case of non-compliance, we will take robust action to remove illegal content to protect consumers.”
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
