Top UK politicians weigh in on the crypto debate, calling for more regulation from the ASA, the FCA, and Treasury on the crypto industry to protect people from losing their money.
Ministers of Parliament in the UK and other campaigners are calling for more regulation of crypto assets. The MPs are calling for cryptocurrencies to be included in the upcoming government review of the 2005 Gambling Act.
Crypto assets are subject to minimal law in the UK. However, the Advertising Standards Authority (ASA) has chided top-flight UK football team Arsenal FC and Floki Inu for their advertisements. Arsenal FC was called out for advertising fan tokens, which promises owners a say in certain club decisions. NFTs promoted by football stars like Wayne Rooney and John Terry have raised concerns of consumers losing money.
Matt Zorb-Cousin, the former aide to Jeremy Corbyn, a Labour Party politician, says, “It’s one thing for football clubs to market gambling to fans, which could lead to people destroying their lives as a consequence, but I think it’s on another level, it’s even worse to be offering a way into cryptocurrency through the pretense of empowering them in an effectively unregulated are.”
FCA’s role in regulation of crypto
The Financial Conduct Authority, the UK’s financial watchdog, currently only has powers to regulate crypto assets if anti-money laundering or terrorism financing laws are breached. They are hoping to gain more authority to investigate the crypto sector.
“At the FCA, we have repeatedly warned about the risks of holding speculative tokens. To be clear: these tokens are not regulated by the FCA,” warned Charles Randall, chair of the FCA in a speech to the Cambridge International Symposium on Economic Crime in Sep. 2021. He also mentioned that the FCA is not looking to impose Draconian regulations since the FCA’s focus is mainly criminal activity and investor protection. The FCA recently approved crypto exchange Coinpass to operate as a crypto assets company.
ASA to issue guidelines on crypto regulation
The ASA has affirmed its responsibility, “We recognize the important role we play in regulating ads.” After banning multiple crypto advertisements in Dec. 2021, the ASA considers monitoring crypto ads a “red-alert priority issue.” The body will issue guidelines to companies soon on how companies can market crypto assets responsibly.
The Treasury is expected to file a response to its findings after consulting stakeholders in 2020. A spokesperson has said that they want to ensure that crypto promotions are not misleading and that crypto meets the “same high standards” expected of other payment methods.
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