UK Government announces clampdown on misleading cryptocurrency adverts to protect more people

dailyrecord.co.uk:

Cryptocurrency adverts will have to meet the same standards as other financial promotions, such as insurance, to help protect people from potentially misleading claims.Promotions will be brought into line with other financial advertising, ensuring they are fair and clear, and helping people to make informed decisions, the UK Government said.

Under the plans, the promotion of cryptoassets will come under Financial Conduct Authority (FCA) rules - in line with other financial promotions such as stocks, shares, and insurance products.The UK Government said this will balance the desire to encourage innovation with the need to ensure adverts are fair, clear, and not misleading.Around 2.3 million people in the UK are thought to own cryptoassets but research suggests some users may not fully understand what they are buying - posing a risk that products could be mis-sold.Around £300 of cryptoassets are held on average.Nearly a third (31%) of cryptoasset holders who saw an advert were encouraged to buy as a result, according to previous research.Chancellor Rishi Sunak said: “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.“We are ensuring consumers are protected, while also supporting innovation of the cryptoasset market.”In 2018 the UK Government launched the Cryptoassets Taskforce, to steer the UK’s regulatory response to the market.The taskforce previously found that misleading advertising and a lack of suitable information was a key consumer protection issue in cryptoasset markets and cryptoasset advertising can often overstate benefits and rarely warn of volatility risks.The changes will