UK government proposes strict rules against misleading cryptocurrency ads

The government of the United Kingdom has stated that it will increase its monitoring of cryptocurrency advertisements and crackdown on “misleading” claims that may cause investors to lose money.

According to recommendations made Tuesday, Finance Minister Rishi Sunak intends to bring the advertisements under the same laws as financial promotions.

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The government plans to submit legislation to update existing financial advertising regulations to include cryptocurrency. Firms that seek to promote financial products must be approved by authorities under the regime.

According to the government, the Financial Conduct Authority, a U.K. watchdog entrusted with regulating financial businesses, will shortly begin consulting on proposed financial promotional laws for cryptocurrencies.

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“Cryptoassets can provide exciting new opportunities, offering people new ways to transact and invest — but it’s important that consumers are not being sold products with misleading claims,” Sunak said in a statement.

The FCA has been chastised for failing to take action against crypto advertisements, which have inundated London’s underground train network and buses in the last year as interest in bitcoin and other digital currencies have grown.

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The FCA warns that cryptocurrencies are unregulated and that anybody investing in them should expect to lose all of their money. While the regulatory body has no authority over the crypto market, in particular, it is becoming more stringent on enterprises participating in the area.

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Last June, the watchdog issued a strong warning to Binance, the world’s largest cryptocurrency exchange, stating that the company is not permitted to engage in any regulated activity. While Binance can continue to offer its services to UK people via its website, it must display a warning stating that its British branch is not regulated.

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Following Tuesday’s announcement, the FCA will eventually have the authority to prohibit crypto advertisements.

Bitcoin, the world’s largest cryptocurrency, is currently down over 40% from its all-time high of about $69,000, which it achieved in November.