- Nearly 90% of crypto firms failed to meet regulatory standards in the past year.
- Crypto promotions must be clear, non-misleading, and include a 24-hour cooling-off period.
- FCA issued 450 consumer alerts in Q1 2024 and pulled over 10,000 deceptive ads.
- FCA canceled 1,261 firm authorizations and pursued 21 financial crime charges in 2023-24.
The UK Financial Conduct Authority (FCA) revealed in its 2024 annual report that nearly 90% of crypto firms applying for registration in the last year did not meet regulatory standards. This announcement comes as the FCA continues its effort to enhance financial stability while also supporting economic growth in the UK.
The agency’s new objective, fostering economic growth while adhering to global standards, has driven several key initiatives, including reforms in wholesale capital markets and enhanced consumer protections in the crypto market.
New Rules for Crypto Assets Promotions
In the crypto sector, the FCA has been particularly vigilant, especially when it comes to consumer protection. New rules implemented for promoting digital assets aim to reduce misleading information and prevent consumer harm.
All crypto promotions must now be clear, not misleading, and provide a 24-hour cooling-off period for investors. In the first quarter of 2024 alone, the FCA issued 450 consumer alerts, highlighting the importance of safeguarding consumers in this rapidly evolving space.
A broader effort to improve transparency has also been a major focus. The FCA has cracked down on misleading promotions, pulling over 10,000 deceptive advertisements and collaborating with social media influencers to stop unauthorized promotions.
Additionally, the regulator is working to prevent financial losses linked to scams and mis-sold products. By introducing stricter marketing rules for crypto assets and enforcing a requirement for firms to obtain FCA approval for financial promotions, the watchdog aims to mitigate consumer risks.
One of the standout achievements for the FCA this year has been its role in financial crime prevention. The agency canceled 1,261 firm authorizations in 2023-24, double the number from the previous year, and pursued charges against 21 individuals for financial crimes. Successful prosecutions highlight the agency’s commitment to maintaining the integrity of the UK financial system.
On a broader scale, the FCA’s collaboration with global regulators, particularly on crypto assets and sustainability initiatives, underscores the UK’s leadership in developing international standards for financial regulation.
Innovation remains a key priority. The FCA’s digital sandbox initiative has allowed UK firms to raise 50% more funding than their global peers, reinforcing the country’s pro-innovation stance. More than 110 regulators worldwide have adopted this model, further positioning the UK as a leader in financial regulation.
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