UK Government finalizes cryptoasset guidance with financial promotions

Securities UK Cryptocurrency Regulation Of Interest to Non-US Persons

On November 2, the UK Financial Conduct Authority (FCA) finalized guidance informing individuals and firms regarding the communication and promotion of cryptoassets. The final guidance follows a consultation period that closed on August 10.

In UK law, Section 21 of the Financial Services and Markets Act 2000 prohibits any person from, in the course of business, communicating a financial promotion – an invitation or inducement to engage in investment activity – unless such person is an authorized person, the content is approved by an authorized person, or another exemption applies.  The guidance describes the application of the financial promotion oversight regime to “qualifying cryptoassets” and expresses the expectation that all “cryptoasset financial promotions must be fair, clear and not misleading.”

The guidance reiterates that it “does not create new obligations for firms but relates to firms existing regulatory obligations” and that persons and firms that act in accordance with the guidance will be considered “as having complied with the rule or requirement to which that guidance relates.”