UK consumers buying crypto assets will get a 24-hour “holiday” for the first time since October under tougher marketing rules announced by the financial regulator on Thursday.
Electronic moneysuch as Bitcointhere is little direct regulation globally, but regulators are taking a closer look after the collapse of FTX last year, causing millions of investors to suffer losses totaling billions of dollars, some of them in the UK.
The Financial Conduct Authority (FCA) says a “refer a friend” bonus for electronic money Buyers will also be disqualified and those promoting such properties will be required to issue clear risk warnings and ensure advertising is clear, fair and not misleading.
New crypto rules, similar to those imposed by the FCA last year to tackle advertising for high-risk investments in mainstream finance, come as Britain plans to regulate cryptocurrencies under the new financial services law this year.
“People decide whether or not they buy crypto,” said Sheldon Mills, executive director of the FCA’s consumer and competition division. But research shows that many people regret making hasty decisions.”
“Consumers should still be aware that cryptocurrencies are largely unregulated and high risk,” he said.
FCA research shows that crypto ownership is estimated to have more than doubled between 2021 and 2022, with 10% of the 2,000 surveyed saying they own crypto assets.
Under the new regulations, crypto companies will have to carry out warnings such as: “Don’t invest unless you are ready to lose all your money. This is a high-risk investment and you should not expect protection if something happens”. wrong way.”
Myron Jobson, senior personal finance analyst at interactive investor investment platform, welcomed the new rules, noting that cryptocurrency advertising has become “the wild west of claims suspicious and misinformed”.
“The challenge for the regulator is to create a strong customer knowledge framework so that all the players involved know what good looks like,” he said.
© Thomson Reuters 2023