Crackdown on Illegal Cryptocurrency Marketing
A serious crackdown on illegal marketing in the cryptocurrency sector has been initiated by the Financial Conduct Authority (FCA) in the UK, particularly targeting firms that do not adhere to established consumer protection regulations. The regulatory body emphasizes that promoting cryptoassets without compliance can lead to criminal charges. Since the establishment of these rules in October 2023, the FCA has proactively engaged with companies in the crypto space, most of which have positively adjusted to meet the new guidelines.
HTX’s Non-Compliance
Despite these efforts, HTX, a firm previously flagged for its unlawful promotion of crypto services, continues to defy regulations by disseminating unauthorized financial promotions across various major social media platforms, including TikTok, X (formerly Twitter), Facebook, Instagram, and YouTube. Of particular concern is HTX’s unclear corporate structure, which obscures the identities of its leadership, making it difficult for regulatory bodies to hold them accountable.
Efforts by the FCA to communicate with HTX have met with silence. While the firm has recently undertaken measures to limit new registrations from UK customers, it remains unclear if these changes will be permanent. Existing users are still able to access the firm’s illicit promotions, raising alarms about the ongoing probability of regulatory violations.
FCA’s Response and Consumer Guidance
Steve Smart, who serves as the joint executive director for enforcement and market oversight at the FCA, stressed the importance of their guidelines, stating, “Our rules are designed to support a sustainable and competitive crypto market in the UK, ensuring that consumers have what they need to make informed decisions.” He further remarked that HTX’s actions starkly contrast with the majority of compliant firms and underscored the FCA’s commitment to enforcing compliance against those undermining the regulatory framework.
In light of HTX’s continued non-compliance, the FCA has taken additional steps, requesting social media networks to block HTX’s accounts and urging app platforms like Google Play and Apple’s App Store to remove HTX apps from UK access. Given HTX’s unauthorized status, consumers should be wary of engaging with the firm, as they would be ineligible for recourse if issues arise. As always, individuals are encouraged to consult the FCA’s Warning List to verify a firm’s legitimacy and to check the dedicated cryptoasset promotions page for guidance on consumer protection.
