United Kingdom’s regulatory agency has taken an active role in regulating the cryptocurrency market, and it is now set to launch a campaign to warn citizens about the risks of cryptocurrency trading and investment.
FCA to warn people about cryptocurrency risks
The Financial Conduct Authority (FCA), the primary financial markets regulatory agency in the United Kingdom, has launched an £11M campaign to raise awareness of the risks associated with cryptocurrencies.
The initiative was unveiled by the CEO Nikhil Rathi in a speech presented earlier today. The regulator is concerned that investors, especially the younger ones, behave less rationally and more emotional when it comes to cryptocurrency investments.
The FCA cited research that revealed that roughly 2.5 million people in the UK had bought cryptoassets. The CEO said, “There is evidence too that, as with the GameStop episode, more people see investment as entertainment – behaving less rationally and more emotionally, egged on by anonymous and unaccountable social media influencers. 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. That’s why we are creating an £11m digital marketing campaign to warn them of the risks.”
Rathi lamented that this group of investors are people the FCA is not used to engaging with, and this presents a particular challenge for them. However, the £11m campaign is designed to help the regulator connect with these classes of investors and warn them of the risks involved.
Crypto investors could lose all their money
The CEO further warned that the cryptocurrency investors could lose all their money. The FCA has been actively regulating the activities of cryptocurrency companies in the UK. It banned Binance Markets Limited from operating in the UK, disclosing that the company doesn’t have the license to operate.
Since the ban, Binance has found it tough to operate in the United Kingdom. So far, banks such as Barclays and Santander have banned their customers from funding their Binance accounts.