Just 24 hours after the deadline for businesses to comply with its new rules on cryptoasset promotion, UK regulator the FCA said it had issued 146 separate alerts about unregistered firms.
In a statement, the regulator said: “We expect businesses including social media platforms, app stores, search engines, domain name registrars and payments firms to consider the alerts we have issued and play their part in protecting UK consumers from illegal promotions.”
It added that consumers should check the warning list issued before making any investment decisions, and that the list would be “continually updated as we identify firms which may be illegally communicating cryptoasset promotions and are failing to engage with us constructively”.
The extensive action taken by FCA comes after a survey carried out by the regulator in September garnered responses from just 24 of 150 firms asked to take part. That prompted a final warning letter to firms in the sector.
Cryptoassets in the UK
The regime, which came into force on October 8, 2023, means firms – including those based overseas, that want to promote cryptoassets in the UK must, by law, be registered or authorised by the FCA, or have their marketing approved by a firm that has been authorised. Promotions must also be “clear, fair and not misleading, labelled with prominent risk warnings and must not inappropriately incentivise people to invest”.
Failure to comply could result in a prison sentence of up to two years.
Companies including Binance and OKX have already implemented changes to comply with the new regime. Binance announced it has launched a new domain for UK users and is linking with rebuildingsociety.com Limited to improve its marketing and communication. OKX has implemented a raft of measures including reducing the number of tokens on offer to UK retail clients from over 100 to just 40, incorporating a prominent risk advisory banner on its web page, and setting up a dedicated channel on X (formerly known as Twitter).
Meanwhile PayPal has temporarily paused the option for UK customers to trade crypto on its platform so that it can put compliance measures in place, and ByBit has announced a suspension of services while it considers how best to meet the new rules.
