Article • about 1 year ago
UK's FCA Assesses Readiness of Crypto Firms for Financial Promotions Regime Implementation
Summary
- The FCA is assessing regulated crypto asset firms to ensure their readiness for the upcoming crypto asset financial promotions regime.
- Some firms have overlooked the content of their digital promotions, focusing mainly on traditional advertising.
- Compliance with the regime's territorial scope is a complex challenge for firms operating globally, but the best-prepared ones have implemented measures such as geo-blocking and KYC/AML to prevent consumers in the UK from accessing promotions intended for other markets.
- The use of social media for promoting financial services, including crypto assets, poses particular challenges, and the FCA has issued updated guidance on financial promotions on social media.
- The FCA has warned that financial promotion rules also apply to brand advertising beyond specific categories, including sports sponsorship deals.
- Clear accountability is emphasized, with the best-prepared firms designating senior individuals responsible for compliance.
- Creating precise formats for risk warnings is still a work in progress for many firms, and compliance with prominence requirements is important.
- Crypto businesses in the UK are also required to comply with the Travel Rule, which mandates the collection, verification, and sharing of important information related to the transfer of crypto assets.
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