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UK's FCA Unveils Rigorous Crypto Ad Regulations and Referral Bonus Prohibition

UK's FCA Unveils Rigorous Crypto Ad Regulations and Referral Bonus Prohibition

FCA aims to regulate the uncontrolled environment surrounding cryptocurrency promotion and safeguard first-time investors.

The UK's Financial Conduct Authority (FCA) has initiated a set of stringent guidelines that will affect cryptocurrency service providers' advertising practices starting October 8th.

Kick-starting new regulations, the FCA announced on June 8th the introduction of a mandatory "cooling-off period" for new investors. This period aims to minimize impulsive investment decisions, often the result of misleading advertisements.

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How to Store NFTs in 2023 (3 Most Secure Ways Explained)

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Furthermore, the regulator has banned the widespread practice of "refer a friend" incentives among cryptocurrency firms.

Cryptocurrency investment decision ultimately lies with the individuals, acknowledged Sheldon Mills, FCA's executive director of consumers and competition.

However, the man pointed out that research often unveils regret among those who have made thoughtless decisions, emphasizing the necessity for these regulatory measures.

Informed decision-making should be at the heart of every investment, and these new rules will encourage such practices, as stated in Mills's official statement. On top of that, Mills noted:

The crypto industry needs to prepare now for this significant change. We are working on additional guidance to help them meet our expectations.

On top of that, the FCA is mandating cryptocurrency firms to establish the investors' know-how and evaluate their prior experience with cryptocurrencies before permitting them to invest. As for the promoters, they are now bound by law to provide comprehensive risk warnings and ensure their advertisements are accurate, transparent, and free of misinformation.

The FCA's tightened regulations are in line with broader government legislation seeking to bring cryptocurrency promotions under stricter regulatory supervision. In May, the news broke that the UK is set to prohibit cold calls promoting financial products like insurance and cryptocurrencies.

The latest actions taken by the FCA underline the growing attention regulators worldwide are giving to the crypto industry, signifying an era of increased scrutiny.

Gile K., Market Sentiment Analyst
Gile is a Market Sentiment Analyst who understands what public events may form what emotions. Her experience researching Web3 news and public market messages – including cryptocurrency news reports, PRs, and social network streams – is critical to her role in helping lead the Crypto News Editorial Team.
As an intelligent professional in public relations, together with the team, she aims to determine real VS fake news patterns, and bring her findings to anyone searching for unbiased news and events happening in the FinTech markets. Her expertise is uncovering the latest trustworthy & informative Web3 announcements to the masses.
When she's not researching the trustworthiness of mainstream stories, she spends time enjoying her terrace view and taking meticulous care of her outdoor environment.



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