Charles Randell, head of the U.K. Financial Conduct Authority (FCA), has said regulators in the country should be given more power to protect consumers from shady cryptocurrency investments promoted online.
Randell, according to a report by Financial Times (FT), said it would take time to completely make a new rulebook for companies, saying it would take “a great deal of thought.”
However, in the meantime, he said there should be more action to put a stop to the risky or fake opportunities out there.
That includes some of the social media influencers promoting “pump and dump” schemes for new coins. In his remarks, Randall said there needed to be more rules specifically against influencers and paid online advertising, which have the potential to be used to mislead customers. In his opinion, big social media and tech companies, like Facebook, Microsoft, Twitter and TikTok, have to do more in order to curb the spread of misinformation.
Randall’s comments come while the U.K. Treasury has been considering a proposal to give the FCA a bigger role in promoting crypto assets. There would be tougher standards under this proposal, which are currently applied to marketing traditional financial products.
Scams related to cryptocurrency have seen a huge proliferation in recent years, with China alone reporting billions in illicit activity.
Chinese crypto addresses sent and received funds for illegal activity from April 2019 through June 2021 totaling $2.2 billion.
Read more: Chinese Cryptocurrency Tied to More Than $2B in Crime, Scams
Crypto scams have become common, though, with British police seizing $249 million in crypto in July that had been linked to a money laundering operation, which was reportedly the biggest in the country’s history. And scams and other such crimes related to crypto totaled $4.3 billion in 2019. That number was higher than the previous two years combined.
The report on China said the reason for the mass surge in crypto scams was the uptick in fentanyl trafficking along with money laundering.
We’re always on the lookout for opportunities to partner with innovators and disruptors.
Learn More