FCA cracks down on crypto advertising

finextra.com:

Set to come into force in October, the new rules mean crypto firms must ensure that people have the appropriate knowledge and experience to invest in crypto. Those promoting crypto must also put in place clear risk warnings and ensure adverts are clear, fair and not misleading, similar to the rules introduced by the FCA last year to tackle misleading financial advertisements of high-risk investments. The UK's Advertising Standards Authority has previously banned several crypto firms’ promotions for being misleading and irresponsible.

For example, Luno’s out of home billboards told people it’s time to buy bitcoin without a clear risk warning. Meanwhile, Arsenal Football Club’s promotion of its fan token with partner Socios on its website and Facebook was deemed by the ASA to have trivialised investing in crypto. The FCA’s guidance follow government legislation to bring crypto promotions into the regulator's remit.

Sheldon Mills, executive director, consumers and competition, says: "It is up to people to decide whether they buy crypto. But research shows many regret making a hasty decision. Our rules give people the time and the right risk warnings to make an informed choice."Consumers should still be aware that crypto remains largely unregulated and high risk.

Those who invest should be prepared to lose all their money."In the future, firms promoting crypto products or services will need to include a clear risk warning such as: "Don’t invest unless you’re prepared to lose all the money you invest. This is a high-risk investment and you should not expect to be protected if something goes wrong. Take 2 mins to learn more."The new rules come into effect as research from the FCA shows that the estimated crypto ownership has