On 31 July 2019, the Financial Conduct Authority (FCA) published final guidance on cryptoassets in its Policy Statement PS19/22 to provide a better protection to market participants.
Section 21 of FSMA provides that a person must not, in the course of business, communicate an invitation or inducement to engage in investment activity unless that person is an authorised person or the content of the communication is approved by anauthorised person. Issuing a financial promotion in breach of section 21 FSMA is a criminal offence.
The FCA expect market participants to apply the financial promotion rules and communicate financial promotions for products and services, whether regulated or unregulated, in away which is clear, fair and not misleading. It is a legal requirement that firms make clear in their promotions which activities are, and are not, regulated, especially when highlighting their FCA authorised status. For example, an authorised firm may decide to offer access to unregulated cryptoassets (such as exchange tokens, like Bitcoin or Ether). The firm must not, in any way, communicate that their authorisation extends to those unregulated cryptoassets, and communication should be transparent to ensure consumers are aware which activities the firm is authorised for.
Investing in, for example Bitcoin, be prepared that there is no fundamental value and the investment will go up or down. It’s possible its value could fall to zero making it worthless.
- Clarity in Promotions about Regulated and Unregulated Business: the FCA’s Expectations
- FCA Guidance on Cryptoassets (PS19/22)
- Have Cryptocurrencies Regulation arrived through the back door?
At LS Consultancy, we offer a number of distinct products and services which can be deployed individually or combined to form a broader solution including copy advice.
When you face business or regulatory challenges, we provide solutions that are tailor-made to your needs with a view to releasing your energies to focus on your clients.
We work both within individual teams and across many departments to offer a complete solution, with a range of cost effective, compliance and marketing solutions which are uniquely suited to supporting firms.