Financial Conduct Authority (FCA) in UK, to tighten the grip on Cryptocurrency firms, with new law.
Financial Conduct Authority (FCA) in UK which is responsible for regulation of financial services, firms and financial markets in the UK is all set to bring a new law later this year (from 8 October 2023).
• The upcoming law will protect consumers from the risks associated with cryptocurrency investing, specially the first time buyers, but the major part of the digital currency will still be volatile and remain largely unregulated and high risk.
"Financial promotion rules for cryptoassets", what this law would do for UK consumers? :
According to the official website of FCA, here we've put some of the points related to the upcoming law.
• A cooling-off period for first time investors from 8 October 2023.
• The new rules would require companies to include cooling off periods and risk warnings in their ads.
• ‘refer a friend’ bonuses will also be banned.
crypto firms must ensure that people have the appropriate knowledge and experience to invest in crypto. Those promoting crypto must also put in place clear risk warnings and ensure adverts are clear, fair and not misleading. The FCA’s rules follow government legislation to bring crypto promotions into the regulator's remit.
Sheldon Mills, Executive Director, Consumers and Competition, said:
'It is up to people to decide whether they buy crypto. But research shows many regret making a hasty decision. Our rules give people the time and the right risk warnings to make an informed choice.
'Consumers should still be aware that crypto remains largely unregulated and high risk. Those who invest should be prepared to lose all their money.
'The crypto industry needs to prepare now for this significant change. We are working on additional guidance to help them meet our expectations.'
FCA research shows that the estimated crypto ownership has more than doubled from 2021 to 2022:
According to the FCA conducted research, the estimated crypto ownership has more than doubled from 2021 to 2022, with 10% of the 2,000 people surveyed stating that they own crypto.
What is a dip in Cryptocurrency?
Cryptocurrency dip is no different from any other market down or dip (value fall), though in the cryptocurrency market unlike other financial market people tend to start buying more of the fallen asset, hence the dips could be defined as: “purchasing an asset when its price has dropped”.
The term “Buy the dip” is also very popular in the cryptocurrency market, the entire idea of buying the dip is to sell it later when the market corrects itself and prices rise again. But, there's a lot more that goes into manipulating the crypto dip.