FCA rules could trigger 'marked drop' in finfluencers marketing crypto

Regulator clamping down over concerns consumers are being 'influenced into high risk investments without understanding consequences'

Following the FCA's new rules on promoting cryptoassets, Oliver Bray, Partner and Hettie Homewood, Senior Associate, at international law firm RPC, comment that the clamp down on high risk investments 'couldn't come at a more needed time' amid the cost of living crisis. They said:

"2023 has been a blockbuster year for legislative and regulatory reform in the consumer protection landscape. 

"With consumers feeling the pinch of the cost of living crisis, the new rules on promoting cryptoassets, which came into force yesterday, couldn't come at a more needed time.  

"The FCA is clamping down in light of concerns that consumers are being influenced into making high risk investments without fully understanding the possible consequences. 

"While it is clearly not the intention of the regulators to stifle fair and compliant marketing of cryptoassets, it remains to be seen how businesses will navigate these increasingly difficult waters. 

"We are already hearing of several big players, including Paypal, suspending some crypto services in the UK to avoid falling foul of the new promotional rules, which is likely to trigger a marked drop in the use of finfluencers and social media marketing for cryptoassets."