FCA Crackdown Fails to Remove Half of Illegal Crypto Ads in UK: Report
The UK Financial Conduct Authority (FCA) faces mounting criticism after data revealed that nearly half of flagged illegal crypto ads remain online despite the agency’s crackdown efforts.
According to a report by the Financial Times, between October 2023 and October 2024, the FCA issued 1,702 alerts regarding non-compliant crypto ads, apps, and websites.
However, only 54% of these ads were successfully removed.
Source: ft.com
The FCA, which has the legal authority to impose fines and initiate criminal cases against violators, has yet to penalize any entity for failing to comply with takedown requests.
Instead, the agency has concentrated efforts on social media influencers, commonly referred to as “finfluencers,” who promote unauthorized financial products online.
While the FCA has made progress in securing voluntary agreements from tech giants like Google and Meta to ban non-compliant paid advertisements, critics argue that the lack of tangible penalties undermines the initiative’s effectiveness.
FCA’s Attack On Crypto Ads: How Far Can The Agency Go?
In a recent high-profile case, the FCA pursued criminal charges against nine social media influencers for promoting unauthorized financial products, including high-risk crypto derivatives.
Some defendants, who gained notoriety on reality television shows such as Love Island and The Only Way Is Essex, face prosecution for their involvement in illegal promotions on platforms like Instagram.
Furthermore, the FCA has placed 20 additional influencers under caution as investigations continue.
Despite these actions, insiders note the lengthy process required to build cases and issue fines, attributing the delay to the regulator’s exhaustive research and legal procedures.
While the FCA implemented new social media promotion rules in March, enforcement has lagged.
Former FCA chair Charles Randell emphasized the need for stricter enforcement, stating,
“Ultimately, unless a very real and present threat of legal action is visible to both the [tech] platforms and to authorized crypto asset exchanges which issue non-compliant ads, we’re unlikely to see any change.”
Randell also criticized the lack of accountability for tech platforms that continue to host illegal ads and stressed the necessity for broader collaboration between regulators and social media companies.
Structural Challenges and the Path to Stronger Regulation
One key obstacle the FCA faces is its limited authority to compel social media platforms to remove non-compliant content directly.
The agency currently relies on voluntary cooperation and good-faith negotiations, which has resulted in inconsistent enforcement.
Although agreements with platforms like Bing and Meta have been partially successful.
The FCA plans to finalize comprehensive crypto regulations by 2026 to address these issues.
The proposed framework aims to tackle market abuse, improve oversight of trading platforms, and establish clear guidelines for stablecoins and crypto lending.
According to a recent report, key measures include prohibiting public crypto offerings by unregulated entities and requiring authorized firms to share information to detect market abuse.
The FCA is inviting public and industry feedback on these proposals, with consultations open until March 2025 as part of a broader plan to finalize a comprehensive regulatory framework by 2026.
This move builds on the FCA’s previous efforts, including bans on marketing by unregistered crypto firms introduced in 2023.
Matthew Long, FCA’s director of payments and digital assets, emphasized:
“We must build a system that safeguards investors while fostering growth in the crypto sector,”
Notably, a recent report shows that crypto ownership in the UK has surged to 12% of the adult population, with over seven million individuals now holding digital assets.
Due to this, public awareness of cryptocurrencies has grown significantly, reaching 93%. Bitcoin, Ethereum, and Dogecoin are the most recognized cryptocurrencies.
Source: cryptonews.com
