The Financial Conduct Authority (FCA), the UK’s financial watchdog, is set to tighten its grip on misleading cryptocurrency adverts. According to a press release, the new guidelines would see the regulator crack down on misinformation about high-risk crypto assets in the UK.
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FCA to fight misleading cryptocurrency ads
The Financial Conduct Authority, a financial regulator in the UK, is introducing stricter guidelines. The idea is to fight against misleading cryptocurrency advertisements. The FCA is preparing to step up its efforts to combat deceptive marketing in the cryptocurrency industry. According to a press release, the regulator will apply the new rules in the UK. Instead, they will crack down on fake news about high-risk crypto assets.
The new regulations require companies to provide “clearer and more visible risk warnings” and prohibit them from offering investment incentives such as referral bonuses. This can help protect investors against losses. Additionally, companies that promote high-risk investments need to conduct more thorough background checks to ensure investors and clients are suitable.
UK regulator bans false advertising
Regulators around the world have expressed concern about the spread of false information about volatile assets such as cryptocurrencies. Against this backdrop, the UK government has attempted to lay the legal groundwork for the cryptocurrency industry. As a result, the government has prioritized the promotion of crypto goods and services before moving on to other aspects of regulation.
The FCA is responsible for regulating the marketing of high-risk digital assets in the UK. However, the FCA is preparing to step up its efforts to combat deceptive marketing in the cryptocurrency industry. Lawmakers have yet to approve the new regulations, so the plan is still in its early stages. Upon approval, the FCA will publish its draft regulations on the promotion and marketing of crypto assets. Beginners and even professional investors continue to lose money because cryptocurrency is a high-risk investment. As a result, the new regulations require brokers who provide digital financial goods to have expertise in their respective fields to promote their offerings.
The Financial Conduct Authority (FCA) has said certain investment inducements will be banned to attract more customers. Additionally, the FCA will prohibit welcome bonuses and referral bonuses. Meanwhile, the FCA wants cryptocurrency companies to be more open about the potential financial risks associated with their products. As a result, consumers can buy cryptocurrencies in the UK. The FCA focuses on preventing terrorism and money laundering while regulating trading in crypto assets. Before a crypto company does business in Britain, it must register with the financial watchdog.
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