UK regulator warns investors off cryptocurrency influencers

FCA warned investors about the risks of financial advice from influencers promoting cryptocurrency and forex trading as a way out of crisis situations. City AM reports.

A representative of the agency told the publication that the warning was prompted by an Instagram post. Its author — a trader with more than 100,000 followers — claims to have earned nearly £2 million after his father’s savings were lost.

He allegedly “traded wisely”, buying Bitcoin at a low price and closing the position at the peak.

“I have achieved success in trading by learning from my own bitter experience and understanding that I could save myself only after I had lost all my money,” the paper quotes the account holder.

The FCA expressed concern about such marketing materials. The regulator stressed that the public should “beware of any advertising from an unauthorised person,” as they would have no protection.

“Always treat investment advice on social media with a degree of scepticism and verify the reputation of those giving advice. When conducting research it is important to use reliable sources,” he added.

In the summer of 2021, the UK Advertising Standards Authority began considering the option of including a disclaimer in cryptocurrency-related advertising.

Earlier in January 2022, the FCA published a draft of rules prohibiting marketing campaigns without an assessment of users’ financial knowledge and experience.

Subsequently the regulator approved stricter rules to curb misleading advertising related to high-risk investment products. However, cryptocurrencies were not included in the document.

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