The British government is considering whether it should allow the Financial Conduct Authority (FCA) to strengthen protections around promotion of financial products and cryptocurrency-related products.
According to a consultation paper, misleading advertising of financial assets or a lack of information can expose potential investors to a level of risk "they are not prepared for."
The government proposes to increase the oversight of financial promotions carried out by unauthorized firms, and to allow the FCA to regulate the promotion of certain types of cryptocurrencies.
The Economic Secretary to the Treasury & City Minister, John Glen states unaware people can end up losing money if advertisements published by unauthorized firms are misleading.
"That’s why we want to put more protections in place around such financial promotions, including the promotion of cryptoassets, while continuing to ensure people have access to a wide range of products on the market," Glen added.
Today, the promotion of cryptocurrencies in the UK is a non-regulated area. However, quite often this sort of advertisement is targeted towards retail investors, underscores the importance of promotions being candid about the risks involved, states the paper.
The deadline for consultations on whether the FCA should receive extended authorities is scheduled on October 25th, 2020.
Earlier this year, Crypto Facilities, a subsidiary of the Kraken cryptocurrency exchange, became the very first crypto trading platform to get a Multilateral Trading Facility (MTF) license from the FCA.
According to an official announcement, with the license, focused on crypto derivatives platform will be able to expand its product range and serve institutional clients.
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