The UK Financial Conduct Authority (FCA) has issued a new warning about upcoming financial promotions for crypto asset companies. From October 8, all crypto firms serving consumers in the UK are expected to comply with these new regulations.
We are Concerned over the Lack of Participation…
In the letter published by the FCA on September 21st, concerns were raised over the lack of participation by crypto asset firms in the new regime. The agency detailed how it could assist firms in complying with the rules announced on June 8th.
This letter, of paramount importance to crypto companies, outlines the steps firms can take to adhere to the regime. It also provides insights into how the FCA might take action against non-compliant firms. Notably, the letter includes new guidelines regarding non-compliant crypto activities that might be considered financial promotions.
“The lack of engagement gives us serious concerns about unregistered firms’ readiness to comply with the new regime.”
Warning to Social Media and Other Businesses
The regulator has also turned its focus to businesses such as social media platforms, app stores, search engines, and payment firms that support crypto asset companies. These businesses have been informed about the risks of supporting firms engaged in illegal promotions.
The FCA reminded businesses of their obligations under the 2002 Proceeds of Crime Act (POCA). Specifically, it expressed concerns that businesses supporting unregistered crypto asset firms could face money laundering charges.
“We are concerned that businesses supporting unregistered crypto asset firms may be at risk of committing money laundering offences under POCA. Intermediaries are at risk of receiving and dealing with this criminal property through, for example, the fees generated by app stores, social media platforms, search engines and domain name registrars hosting illegal financial promotions.”The FCA said in the letter.
Significant changes are on the horizon for crypto asset firms operating in the United Kingdom. This latest warning from the FCA indicates that all firms in the sector need to comply with the new rules. Non-compliance could not only lead to hefty fines but also potentially damage the reputation of the firms involved.