FCA extends deadline for crypto marketing rules | Money Marketing

The regulator could give companies until January 8, 2024 to comply with its upcoming cryptoasset trading rules.

Difficult measures designed to clarify cryptoasset products will go into effect on October 8.

But the Financial Conduct Authority has said it will consider giving cryptoasset companies more time to implement certain changes if they need it.

This could be a cooling off period of 24 hours or even longer to successfully make the necessary administrative changes.

The FCA's director of consumer investment, Lucy Castledine, said: “From October, crypto companies must market to UK consumers clearly, fairly and honestly. And they must provide risk warnings that people understand.

“As a proportionate regulator, we are giving companies that request it a little more time to properly implement the other reforms that require technological and commercial changes.

“We will keep our close watch on businesses during this extended implementation period.

“We are concerned that many foreign and unregulated crypto companies are not engaging with us on the new rules.

“From October 8, we will take action against companies illegally marketing to UK consumers.”

There are potential consequences for anyone who continues to promote crypto assets to UK clients after the October deadline without adhering to the rules.

They may be committing a crime punishable by an unlimited fine and/or up to two years in prison.

The FCA has published examples of good and bad practice on preparing companies for the new marketing regulations.

There will be four routes that cryptoasset companies can take when legally communicating cryptoasset promotions:

1) An authorized person communicates the promotion.

2) An authorized person approves the promotion.

3) A crypto company registered under the Money Laundering Regulations (MLR) communicates the promotion.

4) The promotion otherwise meets the conditions of an exemption in the financial promotion order.

The rules on the promotion of cryptoassets are the result of extensive work with the government in its consultation on the future financial services regulatory regime for crypto assets.

Commenting on an update, Myron Jobson, senior personal finance analyst at Interactive Investor, said: “Stricter rules on cryptocurrency regulation couldn't come soon enough.

“The challenge for the regulator is to design a solid customer knowledge framework so that all the actors involved know what the good is like.

“Armed with knowledge and a discerning eye, investors can better avoid the pitfalls of the crypto landscape.”

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