FCA Releases Guidance on Cryptoasset Financial Promotions

The Financial Conduct Authority (FCA) has released guidance on how firms should comply with the new financial promotions regime for cryptoassets. The guidance, which is open for consultation until August 10, 2023, sets out the FCA's expectations for how firms should ensure that their financial promotions are fair, clear, and not misleading.

The guidance covers a range of topics, including the need for firms to disclose all relevant risks, to use clear and concise language, and to avoid making exaggerated or misleading claims. It also provides specific guidance on how firms should promote cryptoassets that are associated with high-risk business models, such as initial coin offerings (ICOs).

The FCA's decision to release guidance on cryptoasset financial promotions is a welcome step. The cryptoasset market is a complex and rapidly evolving one, and it is important that firms have clear guidance on how to comply with the FCA's rules. The guidance will help to ensure that consumers are protected from misleading or harmful financial promotions.

The guidance is also significant because it reflects the FCA's growing interest in the cryptoasset market. In recent months, the FCA has taken a number of steps to regulate the market, including publishing a discussion paper on the regulation of stablecoins. The guidance on cryptoasset financial promotions is another sign that the FCA is committed to ensuring that the market is properly regulated.

The consultation on the guidance closes on August 10, 2023. The FCA will then consider the responses and publish a final version of the guidance in due course.

In the meantime, firms that are marketing cryptoassets to UK consumers should carefully consider the guidance and take steps to ensure that their financial promotions are compliant.

Here are some key takeaways from the guidance:

• Firms must disclose all relevant risks associated with the cryptoasset being promoted.

• Financial promotions must be fair, clear, and not misleading.

• Firms must use clear and concise language in their financial promotions.

• Firms must avoid making exaggerated or misleading claims in their financial promotions.

• Firms must take particular care when promoting cryptoassets that are associated with high-risk business models.

The guidance is a valuable resource for firms that are marketing cryptoassets to UK consumers. It provides clear and concise guidance on how to comply with the FCA's rules. Firms that follow the guidance will help to ensure that their financial promotions are fair, clear, and not misleading.

https://www.fca.org.uk/publications/guidance-consultations/gc23-1-cryptoasset-financial-promotions-guidance-firms