Crypto memes may amount to criminal offenses if they don’t comply with existing financial promotion rules, warned the United Kingdom’s top financial regulator on Monday.
A newly proposed set of guidelines from the Financial Conduct Authority (FCA) highlighted how “any type of communication” can be considered a financial promotion, and subjected to Section 21 of the Financial Services and Markets Act. The rule states that a person cannot, in the course of business, invite or induce others to engage in investment activity.
The ruling, according to the regulator, extends to memes. “ We have seen memes and other similar communications circulated on social media with users often not realizing they are subject to our rules,” wrote the FCA. It added:
“The use of memes in promotions is particularly prevalent in the crypto asset sector."
As an especially popular asset class with young people, memes are arguably central to how large swaths of the industry – including its community and businesses – relate to each other online. In fact, major cryptocurrencies have popularized around little but the notoriety of the meme they represent – such as Dogecoin (DOGE), which is currently the 9th largest crypto by market cap.
Another Dogecoin-inspired cryptocurrency – Floki (FLOKI) – ran advertisements for its coin on London public transport back in 2021, which were later banned by the Advertising Standards Authority (ASA). However, the FCA had previously warned that it would need new authorities from policymakers before it could independently go after such ad campaigns.
