Rules for crypto asset promotion that came into force in the United Kingdom on Oct. 8 have led to some confusion, judging from the low level of compliance. The Financial Conduct Authority (FCA) responded with additional guidance for crypto firms to help them fall into line.
The FCA released “finalized non-handbook guidance” to compliance with the rules for crypto firms on Nov. 2. It also provided the regulatory agency’s response to industry feedback. FCA director of consumer investments Lucy Castledine said in a statement:
“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.”
The FCA’s supportive attitude toward the crypto industry has been seen in the repeated warnings and reminders it has released since the new rules were published on June 8. It has even extended some technical deadlines through Jan. 8, 2024. In spite of those measures, several market players announced their departure from the U.K. in response to the rules, and compliance has been abysmal since their introduction.
Find out the 3 common issues we’ve identified with #cryptoasset financial promotions.
Consumers should check the FCA Warning List before making any investment in #cryptohttps://t.co/CKn4cFxb11
— Financial Conduct Authority (@TheFCA) October 25, 2023
The new 32-page guidance does not create new obligations for crypto firms, but the authors noted that it reflected a new “secondary international competitiveness objective” in addition to addressing its expectations for firms’ domestic behavior.
Related: UK House of Lords passes bill to seize stolen crypto
The guidance section of the text emphasized key segments of the rules and other pertinent legal documents. The second section gives detailed answers to questions submitted during the consultation phase.
The U.K. implemented the Financial Action Task Force’s Travel Rule on Sept. 1. Legislation regulating stablecoins is expected to be introduced into Parliament next year.
Magazine: You can transform the world with blockchain: Dr. Jane Thomason