FCA Chairman Believes The Regulator Should Continue To Fight Misleading Promotions In The Cryptoasset Industry

In a new speech for the Cambridge International Symposium on Economic Crimes, UK Financial Conduct Authority (FCA) Chairman Charles RANDELL stated that consumers are investing in crypto assets but do not understand the risks. He highlighted the role of celebrities and advertisements, mentioning Kim Kardashian's recent Instagram promotion of Ethereum Max, a new token issued by unknown developers.

Many consumers are not sufficiently aware of the financial risks of such investments, they trust the support of celebrities and dodgy campaigns to promote cryptoassets on the Internet. The FCA chairman stressed that about 2.3 mln UK citizens already own cryptocurrencies, 14% of them used loans to buy cryptocurrencies. According to a study by the FCA, 12% of cryptocurrency holders mistakenly think they will be protected by the FCA or the UK Financial Services Compensation System in case of problems with investments in cryptoassets.

The FCA already regulates crypto exchanges and has banned the sale of cryptocurrency derivatives to retail consumers. Randell believes that further regulatory measures should be limited to two areas – stablecoins and security tokens. According to the FCA chairman, the agency should continue to fight misleading promotions in the cryptoasset industry, which it has been studying for over a year. In July, the UK FCA announced plans to invest £11mln in a cryptocurrency risk warming campaign.

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