FCA issues over 100 alerts in first day of new crypto regulation
The FCA is continuously updating a warning list of non-compliant firms to better protect consumers from illegal promotions
The UK’s financial watchdog introduced a new set of regulations this week mandating enhanced consumer protection, and issued more than 100 alerts in the first 24 hours.
The Financial Conduct Authority (FCA) has compiled a warning list to help consumers better understand where firms’ promotions might be breaking the law.
So far the list includes firms including crypto exchanges Huobi and KuCoin, among dozens of others.
With the new rules in place, crypto providers are now required to display clear risk warnings to all UK-based customers to help protect them from illegal promotions.
The FCA is advising consumers to check the full warning list, which is being continuously updated, before making crypto investments.
Despite warnings from the FCA since February to prepare for the necessary changes, the watchdog expressed worries last month that not enough firms were ready to take action.
“[W]e are concerned by the poor engagement from many unregistered, overseas cryptoasset firms who have UK customers on this important change,” the FCA wrote.
“Many of these firms have refused to engage with the FCA despite our best efforts.”
It said that just 24 firms responded to a survey that was sent to over 150 firms, and said the lack of engagement gives it “serious concerns” about firms’ readiness to comply with the new regime.
Regulatory and compliance service provider Ocorian warned of an impeding crypto asset “regulatory tsunami” with the new financial promotion regime.
The company said it brings “unprecedented restrictions and requirements” for crypto asset firms.
“This seismic shift in regulations will reshape the crypto asset landscape,” Ocorian senior compliance consultant Abdul Motobbir said.
“Market participants must be prepared for a wave of stringent requirements, from mandatory risk warnings to prohibitions on incentives to invest. Ignoring these changes is not an option.”