The Financial Conduct Authority (FCA) in the United Kingdom has outlined its plans for the next year, with a focus on strengthening its ability to detect and combat market abuse in the cryptocurrency sector. The FCA aims to establish a fair and proportional market abuse regime for crypto assets. To achieve this, the regulator will enhance its monitoring and intervention systems to address market abuse and maintain market integrity. Additionally, the FCA will develop advanced analytics capabilities, including network analysis and cross-asset class visualizations.
While some may view the introduction of new regulations for the crypto space as burdensome for companies operating in the UK, the FCA believes that such a framework will foster innovation and reduce industry costs. The regulator will also continue to oversee the financial promotions published by crypto firms and will bolster its technological capabilities to identify promotional materials that could harm investors. Furthermore, the FCA plans to launch consumer awareness campaigns to educate investors about potential scams.
In October 2023, the FCA implemented new rules for crypto-related marketing and released guidance to assist UK-based crypto firms in complying with these regulations. Despite these efforts, many crypto companies are still violating advertising rules. In fact, the FCA revealed that it issued 450 alerts for illegal crypto ads in 2023 alone. The regulator has taken action against companies that breach the rules and intends to continue cracking down on illegal crypto marketing promotions in 2024.
Overall, the FCA’s objectives for the next 12 months reflect its commitment to ensuring a safe and transparent environment for crypto market participants in the UK. By enhancing its capabilities in detecting and combating market abuse, developing a proportionate regulatory framework, and educating investors about potential risks, the FCA aims to foster innovation while protecting consumers.