The UK Financial Conduct Authority (FCA) has asked crypto firms marketing to UK customers to comply with its guidelines by October 8, 2023.
As the UK moves to regulate crypto, its financial watchdog has issued guidelines for the firms advertising to UK consumers.
Two Years Imprisonment for Non-Compliance With FCA Crypto Guidelines
On Tuesday, the FCA executives Victoria McLoughlin and Lucy Castledine issued a notice asking crypto firms to comply with the financial promotion regime. They gave the October 8, 2023, deadline to crypto firms marketing their products to UK consumers.
The FCA informed the firms about four routes for crypto assets promotion to UK consumers:
- An authorized person should communicate the promotions
- If an unauthorized person communicates the promotions, it should be approved by the authorized person
- The promotion is communicated by a crypto asset business registered with the FCA under the Money Laundering, Terrorist Financing, and Transfer of Funds Regulations 2017 (MLRs).
- If the promotion qualifies for the exemption condition under the Financial Promotion Order.
If the crypto firms do not comply with these four routes, they might face punishments such as two years imprisonment, an unlimited fine, or both. The notice further explains:
“We will take robust action against persons illegally promoting to UK consumers. This may include, but it is not limited to, placing firms on our warning list, taking steps to remove or block any illegal financial promotions such as websites, social media accounts and apps, and enforcement action.”
A Move Forward?
The FCA expects the firms to advertise their offerings through MLR registrations. Hence for registrations, the firms must submit the required documents to the FCA and pay a registration fee. After crypto firms submit the documents, the FCA has a time period of three months to evaluate the submission.
The community members find FCA’s crypto guidelines harsh but clearer. A Twitter user wrote:
“Pretty harsh, but if the reglementary line out is clearer than in the USA, it could be a move forward, especially as the UK Prime Minister is not opposed.”
Indeed the UK has been making progressive moves to recognize the crypto asset class. On June 29, BeInCrypto reported that the UK passed the Financial Services and Market Act 2023, promoting the regulation of crypto assets.
Learn more about UK crypto regulation here.
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