UK plans to force ‘high risk’ warnings on crypto adverts

8 Jun 2023

Image: © kurapy/

The FCA’s new measures will ensure crypto ads include warning statements about the risks of the industry to help people make ‘informed choices’.

A UK watchdog is bringing in “tough” new rules to reign in the advertising of crypto assets, due to concerns the market is unregulated and risky for investors.

The new measures by the Financial Conduct Authority (FCA) will make crypto firms put clear risk warnings in their adverts and make sure these ads are clear, fair and not misleading.  The new rules are set to come into effect from 8 October.

Examples of a warning include statements such as “Don’t invest unless you’re prepared to lose all the money you invest” or noting that the investment is ‘high risk’. Companies marketing crypto assets will also have to introduce a “cooling-off” period for first-time investors.

To ensure those who buy crypto are aware of the risks, the FCA said bonuses for referring a friend will also be banned under the new regulation.

The FCA’s consumers and competition executive director Sheldon Mills said the rules will give people the time and the right risk warnings to “make an informed choice” about crypto investments.

“Consumers should still be aware that crypto remains largely unregulated and high risk,” Mills said. “Those who invest should be prepared to lose all their money.

“The crypto industry needs to prepare now for this significant change. We are working on additional guidance to help them meet our expectations.”

The FCA is consulting on additional guidance for setting out expectations of firms advertising crypto, with a deadline of 10 August for those who wish to have an input.

The watchdog’s research suggests that crypto ownership in the UK more than doubled from 2021 to 2022, with 10pc of 2,000 people surveyed stating that they own crypto.

Crypto crackdown

The decision marks further regulatory pressure for the beleaguered crypto sector, which is also facing scrutiny from the US government.

The country’s Securities and Exchange Commission sued crypto exchanges Coinbase and Binance this week, claiming the companies had acted unlawfully in the country.

The sector is still recovering from other developments that have hampered the industry and the trust in its stability, such as the controversial collapse of crypto exchange FTX last year.

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Leigh Mc Gowran is a journalist with Silicon Republic