The FCA announced in June that it would be classifying crypto as “restricted mass market investments”, which would require all crypto advertising and marketing media to contain clear warnings concerning the risks associated with crypto investments.
Cryptocurrency exchange Luno will on 6 October temporarily halt some of its services in the UK, preventing some clients from making investments in crypto. In a statement for Coindesk, Luno’s Head of Public Policy, Nick Taylor explained that this was part of the Digital Currency Group subsidiary’s aim to bring its operations into compliance with Financial Conduct Authority (FCA) regulations. It is not clear how long the suspension is expected to last.
“The FCA has implemented new rules for crypto firms. As a result, all compliant crypto firms with UK customers are making a number of changes to their platforms in order to comply with the new regulations,” Taylor said. “For Luno, this includes pausing the ability to invest through the platform for some customers for the time being.”
The FCA’s new rules for the marketing and promotion of cryptocurrencies will take effect on October 8, two days after Luno is scheduled to suspend some services. An email to a Luno client from the UK, seen by Coindesk, said the client would not be able to purchase or trade cryptocurrency as of October 6. Taylor added that affected users can still sell and withdraw their investments and that the company will reintroduce investment opportunities to its clients using a “phased approach”.
The FCA announced in June that it would be classifying crypto as “restricted mass market investments”, which would require all crypto advertising and marketing media to contain clear warnings concerning the risks associated with crypto investments. The regulator also added that advertisements must not “inappropriately incentivize people to invest” using “refer a friend” or “new joiner bonuses”.
FCA Could Grant Crypto Businesses Operating in the UK until January 2024 to Comply
According to a September 7 press release, crypto businesses registered or approved by the FCA will be able to apply for more time to implement certain changes required by the new rules. Once the application is approved, firms will be given until January 8, 2024, to bring their operations into compliance. There are currently 42 crypto firms registered with the regulator.
“From this October, crypto firms must market to UK consumers clearly, fairly and honestly. And they must provide risk warnings people understand. As a proportionate regulator, we’re giving firms that apply a little more time to get the other reforms requiring technology and business change right. We’ll maintain our close eye on firms during this extended implementation period. […] Come 8 October, we will be taking action against firms illegally marketing to UK consumers,” said Lucy Castledine, Director of Consumer Investments.
Mercy Mutanya is a Tech enthusiast, Digital Marketer, Writer and IT Business Management Student.
She enjoys reading, writing, doing crosswords and binge-watching her favourite TV series.