Luno, a crypto exchange owned by Barry Silbert’s Digital Currency Group (DCG), plans to stop certain UK clients from trading crypto due to regulatory changes that are coming into effect.
The new regulations, introduced by the UK’s Financial Conduct Authority (FCA) and expected to come into effect on October 8, means that exchanges with UK customers must make certain changes to their platform in order to stay compliant, CoinDesk reported on Monday.
Temporary restriction
Luno customers were reportedly informed about the change via an email from Luno that said they would no longer be able to trade crypto starting from October 6 – two days prior to the regulatory changes coming into effect.
Commenting to CoinDesk, Luno’s head of public policy, Nick Taylor, confirmed the news, although he indicated that the restriction is only temporary.
“The FCA has implemented new rules for crypto firms. As a result, all compliant crypto firms with U.K. customers are making a number of changes to their platforms in order to comply with the new regulations,” Taylor was quoted as saying.
“For Luno, this includes pausing the ability to invest through the platform for some customers for the time being,” he added, while stressing that selling and withdrawals would remain open for all users.
Crackdown on crypto marketing and promotion
The new FCA rules centers around marketing and promotion of crypto trading, and categorizes the asset class as “restricted mass market investments.”
Under the new rules, all advertisements for crypto trading will need to be “clear, fair and not misleading,” as well as contain appropriate warnings.
Additionally, all trading incentives such as bonuses will be banned, a move that some crypto lobby groups have criticized.
From 8 October 2023, #crypto firms must market to UK consumers clearly, fairly and honestly, and must also provide risk warnings people understand. https://t.co/cqxj1jVtAT— Financial Conduct Authority (@TheFCA) September 7, 2023
“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,” Sheldon Mills, the FCA’s Executive Director for Consumers and Competition said in a statement about the new rules.
