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As Rishi Sunak takes over as the British’s new Prime Minister in October 2022, he has made crypto one of his main focuses so that the country stays relevant. Let’s see what we can expect from the U.K.’s regulation landscape.
The Financial Conduct Authority (FCA) issued the guidelines on crypto advertising in June this year after the consultation window for the most comprehensive regulatory regime for cryptoended in April.
One of the most crypto-friendly zones in Europe, the U.K. wants to create a beneficial environment for both service providers and users by establishing clear rules in a timely and proactive manner. While crypto businesses must be transparent about their operation to showcase their resilience as well as sustainability, it’s also required that users are informed of the risks related to crypto - high volatility, scams, hacks - same as any other financial assets in their early days. With their prompt actions, British authorities are removing uncertainties over regulations, a major theme in the list of ‘reasons why crypto growth is hindered’.
Following the issuance of new instructions, some crypto businesses have chosen to withdraw from Britain, for example PayPal, Luno, and Bybit. And Binance already canceled their FCA registration in March 2023. First and foremost, it means the opportunity for the U.K.-based crypto companies to have a competitive advantage with regards to their regulatory strategy. On the other hand, it makes crypto service providers to re-think their businesses: how to help users make effective investment decisions without promoted content?
The one and only answer to this question is product design. High-quality products speak for themselves, and the crypto world is flooded with possible innovations. Liquid staking, farming, tokenisation, flexible savings, etc. all are just a few examples of how one may invest and earn with crypto.
Centralised exchanges are the ones given the serious and important responsibility of being the major onboarding point for crypto enthusiasts, especially newcomers. Bybit and Binance may be quitters, but there are others that are devoting extra efforts to expand their product range. One of the remaining options for U.K. crypto advocates is Bitget with their ecosystem of connected activities, from launchpad to initial listing, launchpool, structured and/or principal-guaranteed investment product range. It’s a huge workload considering both product innovation and regulatory compliance in an extremely fast-paced environment, but they are doing it in exchange for the mass adoption of cryptocurrencies, which should be a win-win situation for all parties involved.
Another significant name is OKX. Not only does it offer a vast range of traditional trading options, but its utility extends from the Web3 Yield platform to an expansive NFT Marketplace. Despite past hurdles like the 2020 fund-freezing incident, OKX remains devoted to robust security measures.
Similarly, KuCoin stands out as an advanced trading option, catering especially to seasoned crypto traders. Its impressive arsenal of over 600 cryptocurrencies ensures vast trading horizons, from market leaders like Bitcoin and Ethereum to hidden gems. While its 2020 security incident was a concern, KuCoin's immediate response, fortified by insurance, only bolstered its reputation.
“Clear risk warnings” is another requirement for promoting crypto. That is actually a good thing; users have to own their responsibilities and inform themselves of crypto, not only from a descriptive but also from a technical perspective. Bitget, OKX, KuCoin, Bybit, and Binance all have a separate unit equipped with learning materials called academy, where anyone can find the needed compass to navigate through the ever-evolving territories of crypto.
Those are some ‘ways out’ of the new PR rules set by the FCA, and they prove that these new rules are indeed fostering the right set of circumstances for crypto businesses to thrive. British authorities have paved the way, we as any type of market participants better make the most out of it.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.