Illegal crypto ads continue to plague the financial industry, with the Financial Conduct Authority (FCA) in the UK struggling to crack down on them. Recent data shows that despite issuing over 1,700 alerts about illegal crypto ads, apps, and websites between October 2023 and October 2024, less than 55% of the flagged promotions were actually taken down.
The FCA has the authority to fine or prosecute companies that violate the new rules requiring crypto ads to be approved by the regulator or an FCA-authorized business. However, no penalties have been enforced thus far. Instead, the focus has been on targeting “finfluencers” – influencers on social media who promote risky financial schemes. The FCA has brought criminal charges against nine individuals, including reality TV stars, and is currently investigating 20 more.
Former FCA chair Charles Randell highlighted the need for visible legal action against tech platforms and authorized crypto asset exchanges to facilitate real change in the industry. The lack of enforcement may be contributing to the persistence of illegal crypto ads online.
Looking ahead, the FCA is working towards finalizing comprehensive crypto regulations by 2026. These regulations will address various issues such as market abuse, trading platforms, lending, and stablecoins. Consultations on these regulations are set to begin in late 2024.
Matthew Long, the FCA’s director of payments and digital assets, emphasized the importance of combating market abuse while creating a fair and transparent system for crypto traders. With a growing number of UK adults owning crypto assets (12% as of now), the FCA is committed to developing balanced regulations that prioritize the best interests of investors. The specifics of these regulations are still being determined, but Long assured that they will take into account the unique characteristics of the crypto market.
In the meantime, the UK government is also taking steps to recognize crypto as personal property through new legislation. This move aims to provide clarity and legal protection for individuals holding cryptocurrencies. As the crypto industry continues to evolve, regulatory bodies like the FCA are working diligently to establish a framework that promotes responsible and secure trading practices.