New FCA Law Classifies crypto memes as financial promotions

Under the new FCA proposal, memes that violate financial promotion rules could carry a prison sentence. According to a press release published on Monday, July 17, the Financial Conduct Authority (FCA) is concerned about misleading or inaccurate financial promotions on social media.

The FCA has also released a proposed guidance targeting memes and influencers used in financial promotions, requiring them to include disclaimers. This is part of its efforts to protect consumers from misleading financial promotions on social media, especially those made by crypto firms and influencers. In addition, the regulator acknowledged that many don’t realize that memes from crypto firms circulated online are subject to its promotional rules.

“Too many people across the UK are being shown financial promotions from unsuitable sources.

We’ll be ramping up our work to stamp out illegal financial promotions, particularly those found on social media.” — FCA

The revised guidance on crypto-asset promotions aligns with the FCA’s 2015 guidance, reinforcing its requirement for risk warnings and the ban on investment incentives. Moreover, the new guidance makes it clear that all forms of promotion, including memes, are subject to the regulations.

Prompted by a recent survey showing the majority of young people follow and trust influencers, the FCA has warned that financial influencers who promote products they don’t fully understand could face up to two years in jail, fines, or both. The new law applies even to promotions from outside the U.K. that could have an effect on the country.

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