UK regulator issues a May 2 deadline for compliance in crypto ads
- Crypto firms in the UK have been given a May 2 deadline to comply with advertising standards.
- Firms that fail to comply will be reported to the FCA.
- The ASA reviewed its cryptocurrency advertising standards to protect investors.
The UK Advertising Standards Authority (ASA) has issued a notice to cryptocurrency firms advertising their services. The regulatory body has mandated these firms to review their ads and ensure they comply with the newly released guidelines.
Crypto firms in the UK urged to review their ads
The ASA has sent this notice to more than 50 crypto companies operating in the UK. These companies include Coinbase, Crypto.Com, eToro and Luno. The issuance of this notice comes after the regulator reviewed its guidelines to ensure that cryptocurrency ads do not mislead new investors.
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Part of the notice noted that
This is a ‘red alert’ priority issue for us, and we’ve recently banned several crypto ads for misleading consumers and being socially irresponsible.
Under the new ASA guidelines, crypto advertisements should clearly state that crypto activities are not regulated in the UK. The ads should also mention that crypto assets are highly volatile, and their prices can move up and down unpredictably.
The guidelines state that these ads should not contain misleading statements that show investors that investment decisions are “trivial, simple, easy or suitable for anyone.” The ads should not create a “sense of urgency to buy or create a fear of missing out” or imply that cryptocurrency investments carry a low amount of risk.
Companies providing cryptocurrency services in the UK have been given a May 2 deadline to ensure that their ads are compliant. Ads that fail to comply before this deadline will be reported to the UK financial regulator, the Financial Conduct Authority.
UK crypto regulatory framework
The FCA has oversight over the UK cryptocurrency market. The regulatory body has been stern in ensuring compliance in the sector. Firms that want to operate in the country have to apply for a license with the FCA.
FTX, one of the largest cryptocurrency exchange platforms globally, announced plans to move into the UK market. The exchange noted that it was holding talks with the FCA to ensure its crypto business within the UK market was compliant.