The regulatory compliance clock is ticking for crypto firms in the UK.
The Financial Conduct Authority (FCA) of the United Kingdom has issued a stern reminder to all cryptocurrency businesses marketing within the country. These firms must adhere to the financial promotion regime of the FCA by October or face potential legal repercussions.
In a July 4th letter, the UK's financial watchdog laid out the timeline for compliance.
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Starting October 8th, firms operating within the UK's jurisdiction will have four legitimate pathways to "lawfully communicate cryptoasset promotions" to remain in line with the FCA's standards. These include the approval or communication of a promotion by an authorized party, the creation of a promotion by a firm registered with the FCA, or a promotion that meets exemption criteria under the UK’s Financial Services and Markets Act.
In its letter, FCA claims that promotions to which the new regulations apply include "websites, mobile apps, social media posts and online advertising." On top of that, the ruling applies to all firms whose promotional activities can influence the UK market.
In a LinkedIn post on July 4th, Jayson Probin, Crypto Financial Promotions Lead at the FCA, added that non-compliance might result in severe legal consequences.
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 requesting take downs of websites, social media accounts, apps and all other promotions that are in breach, and enforcement action.
This October deadline was first brought to the public's attention on June 8th, with the FCA encouraging crypto firms to devise marketing strategies that grant potential investors a "cooling-off period" to evaluate the risks associated with digital assets.
At the time of writing, 42 crypto firms, including Revolt, Bitstamp, Galaxy Digital UK and MoonPay, have met these stringent requirements and hold FCA's approval.
The FCA's October deadline underscores the regulator's commitment to securing the UK's cryptocurrency landscape. As the deadline approaches, firms must ensure they meet these requirements to avoid falling foul of the law, safeguarding both their businesses and the interests of their customers in the process.
