UK FCA Asks for Increasing Supervision of Crypto-Related PromotionsSeptember 6, 2021
The UK Financial Conduct Authority (FCA) has called off on Monday to strengthen the supervision on online advertising of crypto-related products and services. According to Reuters, the regulatory watchdog has been concerned about the constant flood of “problematic content” that doesn’t offer value to investors.
“There are no assets or real-world cashflows underpinning the price of speculative digital tokens, even the better-known ones like Bitcoin, and many cannot even boast a scarcity value,” Charles Randell, UK FCA chairman, said in a speech. The authority referred to influencers and celebrities who had been actively endorsing tokens and giveaways related to cryptocurrencies. In fact, he cautioned on scams that are using the digital assets’ name to catch people and persuade them to invest in the schemes.
Moreover, the FCA had been actively asking to assess the feasibility to find the right balance on regulating the environment, and at the same time, providing a good scenario for the crypto companies to develop their businesses in the country. “We’ll need two streams to tackle the problem of online financial scams: appropriate regulation, including self-regulation by online platforms and robust enforcement by the authorities; and greater consumer awareness about online scams,” he pointed out.
Crypto Companies Withdrawing Their FCA Applications
“We are not going to award FCA registration or authorization to businesses which won’t explain basic issues, such as who is responsible for key functions or how they are organized. That would be token regulation in the worst sense,” Randell added.
The warning from the FCA isn’t a surprise, considering that crypto firms had been reportedly quitting their FCA registration application due to the regulations in the United Kingdom. Finance Magnates reported in June that a total of 64 crypto companies had taken their applications back from the British watchdog as the approval process turned out to be extremely slow.
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