New UK Crypto Asset Promotion Rules Lead to Confusion and Low Compliance
The rules for promoting crypto assets in the United Kingdom, which came into effect on October 8, have caused confusion among market players, as compliance has been low. In response, the Financial Conduct Authority (FCA) has issued additional guidance to help crypto firms adhere to the rules.
On November 2, the FCA released “finalized non-handbook guidance” for compliance with the rules for crypto firms. The guidance also includes the FCA’s response to industry feedback. Lucy Castledine, the FCA’s director of consumer investments, stated, “While the new rules for firms marketing crypto to UK consumers are aligned with the existing rules for other high-risk investments, we’ve engaged extensively with industry and designed this Guidance to specifically support crypto firms complying.”
Despite the FCA’s supportive attitude towards the crypto industry, compliance has been abysmal since the new rules were published on June 8. Several market players have announced their departure from the UK in response to the rules, and compliance has been lacking.
The new 32-page guidance does not impose new obligations on crypto firms. However, it reflects a new “secondary international competitiveness objective” and provides clarity on the FCA’s expectations for firms’ behavior.
The guidance focuses on key segments of the rules and other relevant legal documents. It also addresses questions submitted during the consultation phase.
The UK implemented the Financial Action Task Force’s Travel Rule on September 1. Legislation regulating stablecoins is expected to be introduced in Parliament next year.
Overall, the FCA’s guidance aims to assist crypto firms in complying with the rules and promoting a safer environment for UK consumers.
Sources:
– FCA guidance: https://cointelegraph.com/news/fca-releases-guidance-compliance-new-uk-crypto-asset-promotion-rules
– FCA director’s statement: https://cointelegraph.com/news/fca-releases-guidance-compliance-new-uk-crypto-asset-promotion-rules
– FCA warnings and reminders: https://cointelegraph.com/news/fca-releases-guidance-compliance-new-uk-crypto-asset-promotion-rules
– Market players’ departure: https://cointelegraph.com/news/fca-releases-guidance-compliance-new-uk-crypto-asset-promotion-rules
– Compliance breaches: https://cointelegraph.com/news/fca-releases-guidance-compliance-new-uk-crypto-asset-promotion-rules
– Travel Rule implementation: https://cointelegraph.com/news/fca-releases-guidance-compliance-new-uk-crypto-asset-promotion-rules
– Stablecoin regulation: https://cointelegraph.com/news/fca-releases-guidance-compliance-new-uk-crypto-asset-promotion-rules
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About the author - J-S Tremblay
I've been involved in the cryptocurrency world since 2016 and trading since 2019. I started Moon and Lambo in 2021. I'm passionate about crypto and love to share my knowledge. I hate bankers and I hope that cryptocurrency will change the financial world for the better. View full profile...
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