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 <p class="is-style-lead">Nearly 70% of crypto communications violated FINRA’s guidelines, a recent survey says.</p>
 <p>The American Financial Industry Regulatory Authority (FINRA) has just published a detailed report on a survey of 500 retail communication channels related to cryptocurrencies. According to the findings, published in Jan. 2024, approximately 70% of communications since late 2022 have violated FINRA’s Rule 2210, a rule that governs broker-dealer communications with the public.</p>
 <p>While FINRA did not disclose who exactly violated the rule, the regulator noted that some firms “failed to clearly differentiate in <a rel="noopener noreferrer nofollow" title="communication" href="https://thebittimes.com/tag/communication.html">communication</a>s, including mobile apps, between Crypto Assets offered through affiliates or third parties and those offered directly by the member.”</p>
 <blockquote class="wp-block-quote">
  <p>“This update does not create new legal or regulatory requirements or new interpretations of existing requirements, nor does it relieve firms of any existing obligations under federal securities laws and regulations. Rather, this update poses questions for firms to consider as they review and supervise their retail <a rel="noopener noreferrer nofollow" title="communication" href="https://thebittimes.com/tag/communication.html">communication</a>s concerning Crypto Assets.”</p>
  <p>FINRA</p>
 </blockquote>
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 <p>Moreover, FINRA identified instances where firms made “false statements or implied” that <a rel="noopener noreferrer nofollow" title="crypto" href="https://thebittimes.com/tag/crypto.html">crypto</a>currencies function like cash. Additionally, some firms failed to provide a “sound basis” for evaluating <a rel="noopener noreferrer nofollow" title="crypto" href="https://thebittimes.com/tag/crypto.html">crypto</a>currencies, as well as misrepresented that the protections of federal securities laws or FINRA rules applied to <a rel="noopener noreferrer nofollow" title="crypto" href="https://thebittimes.com/tag/crypto.html">crypto</a>.</p>
 <p>In a related context, a previous report from FINRA in May 2023 highlighted that new investors in the <a rel="noopener noreferrer nofollow" title="crypto" href="https://thebittimes.com/tag/crypto.html">crypto</a> market were more likely to be influenced by their friends’ suggestions than those venturing into the equities or bond markets.</p>
 <p>The survey found that over 30% of new <a rel="noopener noreferrer nofollow" title="crypto" href="https://thebittimes.com/tag/crypto.html">crypto</a> investors cited “friend suggestion” as their primary motivation for investing in the novel digital asset. That’s compared to just 8% for first-time equities or bond investors, suggesting that there’s a social element to <a rel="noopener noreferrer nofollow" title="crypto" href="https://thebittimes.com/tag/crypto.html">crypto</a>currency investing that’s not evident in traditional markets.</p>
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<p>Source: <a rel="noopener noreferrer nofollow" target="_blank" href="https://thebittimes.com/finra-says-majority-of-crypto-communications-violate-investor-protection-guidelines-tbt77559.html">https://thebittimes.com/finra-says-majority-of-crypto-communications-violate-investor-protection-guidelines-tbt77559.html</a></p>

FINRA says majority of crypto communications violate investor protection guidelines

TheBitTimes

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