The FCA has revealed new rules that would need to be followed by firms and individuals when they endorse crypto memes on social media.
The Financial Conduct Authority (FCA), the prime UK regulator for financial services, has published a press release. The notice broadly touches upon a few points for the regulation of crypto memes on social media. Their guidance may require financial influencers and other firms to start displaying disclaimers on their endorsements.
The FCA has mentioned how any kind of communication by a firm could be considered a financial promotion. It noted the presence of financial promotions from unreliable sources, for which the new rules have been drafted.
The guidance from the FCA was also aimed at financial influencers. These ‘finfluencers’ were directed for responsible promotions hereafter by the UK authority. The regulator said that failure to adhere to the rules could also attract jail time.
“FCA engagement has also helped secure changes to the advertising policies of several Big Tech companies to only allow financial promotions that have been approved by FCA-authorized firms. The regulator will be continuing this engagement to ensure more is done to protect consumers,” said the press release of the FCA.
The FCA’s official guidance for social media is a comprehensive document containing all policies and rules for the crypto sector’s promotional activities. It could be a step in the right direction due to the consumer-centric nature of the document. Moreover, illegal promotions in the industry could also be weeded out through the rules.