# UK watchdog warns crypto firms to prepare for advertising rule change
Author:  Pal Sinha, Barnali 
Author URL: https://financedigest.com/author/pal-sinha-barnali
Published: 2023-02-06
Category: TRADING
Category URL: https://financedigest.com/category/trading
Meta Title: Crypto Firms Warned of Rule Change on Advertising in UK
Meta Description: Ensure compliance with FCA anti-money laundering safeguards to avoid up to two years in prison for breaches. Start preparing now!
URL: https://financedigest.com/uk-watchdog-warns-crypto-firms-to-prepare-for-advertising-rule-changehtml

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LONDON (Reuters) -Britain’s financial watchdog warned crypto businesses on Monday to get ready for a rule change on advertising later in the year, warning that any breaches by company officials could mean up to two years in prison.

Britain’s finance ministry said last week it would set out secondary legislation this year to allow crypto firms which comply with the Financial Conduct Authority’s anti-money laundering safeguards to issue their own promotions until new crypto regulation is introduced, probably sometime in 2024.

Currently the advertising must be approved by a firm which has full FCA authorisation.

The government also said it would reduce the implementation period for the change to four months from six months after the [secondary legislation has been set](https://www.financedigest.com/oneweb-eutelsat-set-for-secondary-london-listing-the-times.html "OneWeb-Eutelsat set for secondary London listing – The Times") out by parliament.

The FCA will also be given supervision and enforcement [powers over AML-complying cryptoasset businesses](https://www.financedigest.com/national-world-launches-new-ad-manager-platform-powered-by-danads-empowering-businesses-to-take-control-of-their-advertising.html "National World launches new ad manager platform, powered by DanAds, empowering businesses to take control of their advertising") promoting cryptoassets, such as forcing a company to take down its website.

All cryptoasset [firms marketing](https://www.financedigest.com/how-marketing-helps-law-firms-grow.html "How Marketing Helps Law Firms Grow") to UK consumers, including firms based overseas, will soon need to comply with the new UK financial promotions regime,” the FCA said in a statement on Monday.

[“Firms must](https://www.financedigest.com/finance-firms-must-ensure-they-fix-data-fundamentals.html "Finance firms must ensure they fix data fundamentals") start preparing now for this regime. We will take robust action against [firms breaching these requirements.”](https://www.financedigest.com/encompass-and-nikkei-media-marketing-partner-to-support-firms-with-know-your-customer-requirements.html "encompass and Nikkei Media Marketing partner to support firms with Know Your Customer requirements")

The watchdog said cryptoassets [remain high risk](https://www.financedigest.com/with-greater-freedom-comes-heightened-risk-how-to-help-ensure-consumer-data-remains-secure-in-an-open-banking-system.html "With Greater Freedom Comes Heightened Risk: How to Help Ensure Consumer Data Remains Secure in an Open Banking System"), and reiterated that consumers should be prepared to lose all of their money if they buy cryptoassets.

There is unlikely to be any compensation under the [Financial Services Compensation Scheme for consumers](https://www.financedigest.com/uk-consumer-mood-hits-one-year-high-but-financial-gloom-persists.html "UK consumer mood hits one-year high, but financial gloom persists") who lose money,” it added.

(Reporting by Huw Jones; editing by Louise Heavens and Jason Neely)


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