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The UK Financial Conduct Authority (FCA) is turning the regulatory spotlight on memecoin 'finfluencers' as it seeks to rein in memecoin-centric marketing for financial products.
The FCA has published guidelines for both financial services companies and social media influencers who create memecoins about cryptocurrencies or other investments. The regulator emphasizes that all marketing must be transparent and not misleading.
The FCA stated that 'finfluencers' must obtain approval from an FCA-appointed representative before advertising financial products and services or issuing memecoins. “Influencers are reminded that it may be a criminal offense to promote a financial product without the consent of an FCA authorized person with the correct consent,” the regulator wrote.
The FCA also urged consumers to be wary of questionable advertising and online scams. He stated that it is important for influencers to ensure they comply with the rules and consider the potential damage to their reputation if they are found to be promoting illegal products.
Lucy Castledine, the FCA's director of consumer investment, said the watchdog would “take action against those who promote financial products illegally”. The regulator noted that promotion through memecoins is particularly popular in the cryptocurrency industry, which has a dedicated memecoin space.
The FCA's latest warning comes after it stressed last month that it would take action against firms running illegal financial promotions. Last year, the agency issued 450 warnings as part of its enforcement efforts against illegal cryptocurrency advertising.
*This is not investment advice.