We are now in the final week before the Financial Services and Markets Act 2000 (Financial Promotion (Amendment) Order 2023 comes into force. This will see aspects of the existing UK financial promotions regime apply to the marketing of certain cryptoassets to UK consumers. 

In very broad terms the existing UK financial promotions regime applies to prevent the marketing of certain investment activity, unless the marketing communication has been made or approved by a firm authorised by the FCA or an exemption applies. 

Historically, the marketing of crypto investment opportunities has broadly been governed by a mix of existing advertising and consumer law and regulation (see here for our summary of the previous challenges facing the Advertising Standards Agency). However, from 8 October 2023 the financial promotion regime will be extended to include financial promotions aimed at marketing investments in "qualifying cryptoassets", being any cryptographically secured digital representation of value or contractual rights that which is fungible and transferable. 

Certain types of digital asset will not fall within this definition (notably emoney, fiat currency (including digitally issued), NFTs and certain utility tokens), and certain exemptions apply, including where a firm is registered under the FCA's money laundering rules. However, in its "Final warning" letter of 21 September 2023 the FCA has noted that "We expect the vast majority, if not all cryptoasset firms providing services to UK consumers will be in scope of this regime when it comes into force". As has been widely published, the relatively short implementation period is now almost at an end, with concerns remaining around readiness and compliance amongst affected firms.

Interestingly, in the same communication the FCA further notes that there may also be an impact on those supporting unregistered cryptoasset firms. So, organisations that provide services to or perhaps partner with crypto service providers for advertising purposes may also wish to consider their position in light of the change in the law.   

Stevens & Bolton is running a seminar on 11 October that will be covering this topic as well as others of relevance to in-house lawyers, directors, HR professionals, and those engaged in contracts, procurement, and commercial affairs. If you are interested in attending, please click here to register.