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UK to Tighten Rules on Crypto Ads

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UK to Tighten Rules on Crypto Ads

To ‘protect consumers from false promises,’ the UK government announced intentions to put new limits on cryptocurrency ads on Tuesday. The announcement specified: “New rules will increase consumer protection while encouraging innovation.” The UK chancellor of the exchequer, Rishi Sunak, remarked: “Crypto-assets can provide exciting new opportunities, offering people new ways to transact and invest – but it’s important that consumers are not being sold products with misleading claims.” The new guidelines will put crypto-asset advertising within the scope of financial promotion legislation, ensuring that it is ‘fair, unambiguous, and not misleading,’ according to the government.  “This means the promotion of qualifying crypto assets will be subject to FCA rules in line with the same high standards that other financial promotions such as stocks, shares, and insurance products are held to.” The UK government stated that while it is eager to foster innovation, ‘analysis performed by the Financial Conduct Authority (FCA) revealed the potential for false promotion of crypto products to cause consumer harm.’ According to the UK Financial Services and Markets Act 2000, a company cannot promote a financial product unless it has been authorized by the FCA or the Prudential Regulation Authority (PRA), or the content of the promotion has been approved by a company that has, the government noted, adding: “This will provide the Financial Conduct Authority with the appropriate powers to regulate the market more effectively.” The UK Advertising Standards Authority (ASA) has recently cracked down on deceptive crypto advertisements. Seven crypto adverts for Papa John’s Pizza, Coinbase, Kraken, Etoro, Luno, Coinburp, and Exmo were banned by the British advertising authority in December. It banned advertisements for the cryptocurrency floki inu in November (FLOKI).

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