Lawmakers in the UK are now targeting crypto memes and fintech influencers in an effort to enforce new social media guidelines.
According to a new press release by the nation’s Financial Conduct Authority (FCA), the regulatory agency will be cracking down on illicit and non-compliant financial promotion starting in October.
“The FCA has been ramping up its scrutiny of online, often illegal, financial promotions, recognizing the significant increase in notoriety of ‘finfluencers’ and the potential for consumer harm taking place online…
From October 8, 2023, the FCA will ban incentives to invest in crypto, such as ‘refer a friend’ bonuses. Firms must also introduce clear risk warnings and a 24-hour cooling period to give first-time investors the time to consider their investment decision. These measures are similar to the regime in place for other high-risk investments.”
In its new guidelines, the FAC also says that crypto-focused memes that encourage investing in digital assets may constitute as non-compliant promotions and could be subject to the law.
“Firms are reminded that any type of communication is capable of being a financial promotion and subject to S21. We have seen memes and other similar communications circulated on social media with users often not realizing they are subject to our rules. The use of memes in promotions is particularly prevalent in the crypto asset sector.”
As stated by Lucy Castledine, the FCA’s Director of Consumer Investments, in the press release,
“We’ve seen a growing number of ads falling short of the guidance we have in place to stop consumer harm. We want people to stay on the right side of our rules, so we’re updating our guidance to clarify what we expect of firms when marketing financial products online.
And for those touting products illegally, we will be taking action against you.”
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