UK government latest to ramp up scrutiny of crypto ads
- HM Treasury said it would ramp up scrutiny of crypto advertising in the UK.
- The move will bring crypto marketing within the scope of financial promotions legislation.
The UK government on Tuesday became the latest authority to tighten its rules around crypto advertising, in a move that will see the regulation of adverts brought into line with other financial promotions.
In a press release, HM Treasury, the UK's finance ministry, said it is "eager to support innovation in cryptoassets" and recognizes the potential of certain products such as stablecoins to provide a more efficient means of payment.
The move will bring crypto marketing within the scope of financial promotions legislation. This means the promotion of qualifying cryptoassets will be subject to Financial Conduct Authority (FCA) rules, in line with the same standards that financial promotions for stocks, shares, and insurance products are held to.
"Cryptoassets can provide exciting new opportunities, offering people new ways to transact and invest – but it’s important that consumers are not being sold products with misleading claims," said Rishi Sunak, chancellor of the exchequer.
The government taskforce on cryptoassets has been mulling its regulatory response to the sector since 2018.
The consultation document published on Tuesday took into account a range of concerns from businesses in the space, including the government definition of cryptoasset, the implementation of a transition period and the proposed approach.
The proposed definition set out several criteria for a qualifying cryptoasset, including that it is fungible, transferable, not electronic money as defined in the Electronic Money Regulations, and not a currency issued by a central bank or public authority.
The Block asked the Treasury for a list of firms consulted but had not heard back by the time of publication.
Today's news follows a slew of bans from the UK's advertising regulator on crypto-related marketing, and a hold on approvals for crypto adverts by London's travel authority.
In December, the Advertising Standards Authority (ASA) issued a ‘red alert’ warning on the marketing of crypto-assets, banning seven separate ads in one swoop.
Companies whose ads were deemed to have broken the rules at the time included trading platforms eToro and Coinburp; exchanges EXMO, Luno, Kraken and Coinbase; as well as a promotion from pizza chain Papa John's.
Since then it has also ruled on Arsenal Football Club's marketing of fan tokens and two adverts from Crypto.com.
This week, Singapore and Spain also tightened their rules around crypto promotions.