In recent years, the United Kingdom has made significant progress in the reshaping of the regulatory landscape of cryptographic assets. With the aim of finding a balance between innovation and the protection of investors, the latest FCA measures, ranging from financial promotion rules to the expansion of anti-white monitoring (“AML”) signal a more difficult position which already gives birth to legal uncertainty and disputes.
In 2024, the British approach, under the FCA, went from prudent observation to active intervention. The extension of financial promotions rules to Crypto-Asembres companies, whether based in the United Kingdom or abroad, has introduced new friction points. These rules force companies to ensure that all marketing communications are “Clear, just and not misleading”, ” (Cobs 4.2). Failure is not only a regulatory violation, but an invitation to dispute.
Around the world, disputes are likely to surface on several fronts. Bonus among these will be missing allegations. Hords of investors who have witnessed cryptocurrency values will examine whether companies have adequately disclosed risks in accordance with new FCA standards. These allegations should echo the wave of disputes poorly sold by the financial products observed during the previous decades. Indeed, the United States has already attended a wave of sales disputes absent in high-level cases such as FTX, Celsius and travel where the platforms have misleaded investors on security, regulatory status or financial health of their offers, resulting in billions of loss and fraud convictions.
In addition, companies abroad targeting British customers will now be the scope of the FCA for financial promotions. This cross -border range creates mature legal areas for a challenge, in particular with regard to application and jurisdiction. It remains to be seen how it will have an impact on other jurisdictions such as the United States, where the application of cross-border cryptographic disputes involves a mixture of interior actions and international cooperation.
With the FCA, a meticulous examination, companies that are not below new requirements can face regulatory sanctions. Disputes between companies and regulators will become more common, especially since the definitions of cryptographic assets and qualification promotions continue to evolve. LMA can also be problematic. While crypto exchanges and portfolio providers are struggling with extended obligations of LMA, the failures of internal compliance can lead to allegations of denunciation, internal surveys and conflicts with the police.
The US administration has dismantled the main law enforcement organizations – including the national Crypto -Monnaie Application team of the DoJ – and has canceled an enlarged IRS broker reporting, demonstrating that it actively removes monitoring in favor of industry growth. This deregulating trajectory contrasts strongly with the proactive position of the United Kingdom, where the FCA introduced concrete measures to protect consumers and maintain market integrity. However, according to the analysis of the Atlantic Council, such differences may expose British consumers to increased systemic vulnerabilities, as prohibited capital move to less regulated American markets can undermine the guarantees integrated into the British regime. In response, British regulators are likely to deal with mounting pressure to further calibrate the interior rules, both to prevent regulatory arbitration and to ensure that consumer protection remains robust in the middle of this world divergence.
Comment
The FCA clearly indicated that cryptoassets are no longer in a regulatory gray area. The United Kingdom develops a stricter and proactive approach intended for consumer protection. This includes in progress consultations and rule stages designed to introduce cryptocurrency in an “fully regulated asset class” by 2026. These contrast approach to the application of the United States where a strict regulatory framework has been abandoned in favor of post-incidental surveys and judicial decisions. This bifurcation will require the creation of proactive British rules and international coordination with the EU to protect consumers and preserve the integrity of the market.
For stakeholders through the cryptography sector, from startups to exchanges, including institutional investors and even individual traders – the evolution of legal and regulatory expectations increases participations. The path of compliance is no longer negotiable, but the interpretation of these compliance tasks is far from being settled.
While the FCA continues to tighten the reins, we are only placed to help customers manage the benefits. Whether it is a question of advising compliance, mitigating disputes or representing customers in regulatory procedures, lawyers will be decisive in the purchase of businesses through this quickly changing landscape. In the world of cryptography regulation, uncertainty reproduces disputes, but it also creates opportunities. While the regulatory fog rises, our team of disputes will help you charter a safe route and consistent with the storm.
