Rishi Sunak cracks down on misleading crypto adverts in UK

business-standard.com:

Chancellor of the Exchequer Rishi Sunak has laid out plans for the UK's Financial Conduct Authority (FCA) to crack down on misleading adverts of cryptocurrency, bringing it in line with other financial promotions.

A consultation response, published on Tuesday, sets out the UK government's plan to bring the promotion of so-called cryptoassets within the scope of financial promotions legislation.

This means the promotion of qualifying cryptoassets will be subject to FCA rules, in line with the same standards that other financial promotions such as stocks, shares, and insurance products are held to.

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, said Sunak.

We are ensuring consumers are protected, while also supporting innovation of the cryptoasset market, he said.

The Indian-origin finance minister's move involves plans to legislate to address misleading cryptoasset promotions.

According to the UK's Treasury department, around 2.3 million people in the UK are now thought to own a cryptoasset with their popularity rising.

However, FCA research suggests that understanding of what crypto actually is declining, suggesting that some users may not fully understand what they are buying.

This poses a risk that these products could be mis-sold. The Treasury said the government's move to put the FCA in charge is intended to balance the desire to encourage innovation with the need to ensure that cryptoasset advertisements are fair, clear, and not misleading.

The government said it recognises the potential benefits of certain products like stablecoins, such as providing a more efficient means of