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FCA seeks feedback on plans to enhance transparency in the UK’s crypto markets

FCA Implements Stricter Rules for Marketing Cryptoassets
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The Financial Conduct Authority (FCA) has launched Discussion Paper DP24/4 to gather insights and feedback on its proposals for improving transparency and integrity in the UK’s crypto markets. These plans aim to establish clear, robust, and proportionate rules for the cryptoasset industry, ensuring a fair and sustainable marketplace that protects consumers and promotes innovation.

Crypto regulation is an essential step toward creating a trusted and competitive UK crypto market. Clear admissions, disclosures, and market abuse regimes are critical for fostering confidence, supporting informed decision-making, and ensuring the sector adheres to high ethical standards.

The FCA’s proposals focus on:

  • Improving regulatory clarity: Establishing consistent ‘rules of the game’ for both firms and consumers.
  • Providing better information: Ensuring consumers are well-informed about risks before buying or selling cryptoassets.
  • Promoting fair trading: Requiring firms to implement controls and processes that support fair and orderly trading conditions.
  • Reducing fraud and money laundering: Introducing strong safeguards to prevent harm and protect market participants.

By addressing these challenges, the FCA aims to create a sustainable, robust, and trusted environment that encourages long-term investment and innovation in the UK.

The FCA emphasises the importance of collaboration in shaping the future crypto regime. The insights in DP24/4 stem from earlier crypto policy roundtables held in April and May 2024, as well as the Government’s prior consultation. Now, the FCA is inviting input from a broad range of stakeholders to refine its approach further.

Who should respond?

This Discussion Paper is relevant to a diverse range of participants and experts in the crypto and finance sectors, including:

  • Cryptoasset firms, including trading platforms, intermediaries, and principal trading firms.
  • UK crypto investors, consumer groups, and individual consumers.
  • Traditional finance participants, such as banks and asset managers.
  • Industry groups, professional advisers, law firms, and accountancy firms.
  • Policymakers, academics, think tanks, and other regulatory bodies.

Stakeholder feedback is crucial to developing a fair, balanced, and proportionate regulatory framework. Domestic and international participants are encouraged to share their thoughts by the 14th March, 2025.

Encouraging innovation without stifling growth

The FCA has expressed its commitment to reducing risks in the crypto market while supporting its growth and innovation. It is encouraging firms to take the lead in developing innovative ways to disclose critical information, ensuring consumers fully understand the risks before engaging with cryptoassets.

The FCA is also proposing that certain firms, like authorised crypto trading platforms, share information to detect and prevent market abuse. This collaborative approach aims to enhance transparency, reduce fraud, and promote good practices across the industry.

As the FCA continues to develop the UK’s crypto regulation, it reminds consumers that crypto remains largely unregulated in the UK and is considered high-risk. If something goes wrong, protections are limited, and individuals should be prepared to lose all their invested funds.

By shaping a marketplace that is transparent, trustworthy, and well-regulated, the FCA seeks to foster an environment where both consumers and firms can thrive.

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