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 The U.K.’s Financial Conduct Authority (FCA) has<a style="color: #0000ff;" href="https://www.fca.org.uk/news/news-stories/fca-helps-improve-crypto-firms-compliance-new-marketing-rules" rel="noopener noreferrer nofollow"> evaluated</a> cryptocurrency firms’ compliance with the new financial promotion regulations<a style="color: #0000ff;" href="https://www.fca.org.uk/publications/policy-statements/ps23-6-financial-promotion-rules-cryptoassets" rel="noopener noreferrer nofollow"> introduced</a> in October 2023 to enhance consumer awareness of crypto investment risks.
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During the evaluation, the FCA examined how companies implemented personalized risk warnings, the mandatory 24-hour cooling-off period, client categorization, and appropriateness assessments. Acknowledging the transitional challenges faced by crypto firms aligning with these initial rules for U.K. consumer marketing,
The FCA highlighted that while some firms demonstrated good practices, many did not meet the required standards.
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 “Firms have requested additional clarity on our expectations for these rules. We want to work collaboratively with the sector to raise standards and this publication will help firms meet their obligations and support consumers in making informed decisions,” 
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The FCA noted.
The regulator emphasized the need for firms to improve compliance and provided examples of good and poor practices to guide them. It further urged firms to read its published guidance, GC23/1, and avoid relying on industry comparisons due to widespread poor practices in the market. Instead, firms are encouraged to engage directly with the FCA to raise standards.
They pledged to take action against non-compliant entities, including the financial promotions regime when assessing applications under the future financial services regulatory regime for crypto assets.
The FCA remains committed to working with the industry to enhance compliance and support consumers in making informed decisions.
Simultaneously, recent developments have emerged concerning Coinbase’s<a style="color: #0000ff;" href="https://defi-planet.com/2024/07/coinbase-fined-3-5-million-by-uks-fca-for-violating-high-risk-client-restrictions/" rel="noopener noreferrer nofollow"> U.K. subsidiary, C.B. Payments Limited (CBPL), which has been fined £3.5 million by the Financial Conduct Authority (FCA)</a> for “repeatedly breaching a requirement” that restricted the firm from offering services to high-risk customers.
Despite a voluntary agreement to limit onboarding high-risk clients, CBPL onboarded and served over 13,400 high-risk customers. Over 30% of these clients deposited nearly $25 million, which was used for withdrawals and crypto transactions, totalling approximately $226 million.
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The post <a href="https://defi-planet.com/2024/08/fca-evaluates-crypto-firms-adherence-to-financial-promotion-rules-warns-of-regulatory-action/" rel="noopener noreferrer nofollow">FCA Evaluates Crypto Firms’ Adherence to Financial Promotion Rules, Warns of Regulatory Action</a> appeared first on <a href="https://defi-planet.com" rel="noopener noreferrer nofollow">DeFi Planet</a>.

FCA Evaluates Crypto Firms’ Adherence to Financial Promotion Rules, Warns of Regulatory Action

DeFi Planet

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