“Explosion” of Crypto Among Younger People has FCA “More Rigorous,” Launches $15M Marketing Campaign
The UK Financial Conduct Authority (FCA) is launching an £11 million (just over $15 million) marketing campaign to warn the younger generation of the risk of investing in crypto assets.
It was revealed during the FCA’s business plan webinar titled, “Transforming to a forward-looking, proactive regulator,” by the head of the agency, Nikhil Rathi.
“We’ve seen an explosion among younger people speculating on cryptocurrencies or other high-risk investments,” said Rathi, noting nearly 2.5 million people in the UK had bought crypto assets in the last year.
FCA described this investor group more on the younger side and more likely from an ethnic minority while comparing it to the GameStop episode where people see investment as entertainment – behaving less rationally and more emotionally. It added,
“This is a category of consumer that we are not used to engaging with – 18 to 30-year-olds more likely to be drawn in by social media.”
While the regulator will support innovative companies through its Digital Sandbox by making it permanent, it would only apply to those who meet their regulatory expectations. The FCA said,
“Firms should expect us to be even more rigorous on upholding high standards – especially on governance, conflicts of interest and conduct, including considering diversity and inclusion as regulatory issues.”
It particularly mentions crypto firms applying for anti-money laundering registration as high-risk businesses and complex markets.
These increased measures from FCA come on the heels of the Advertising Standards Authority’s plan to tighten its monitoring of the crypto market. Earlier this month, it said instead of their previous reactive approach, they would now be proactively looking for irresponsible or misleading ads for crypto products.