The United Kingdom Is Cracking Down on the Bitcoin Business

In an effort to better safeguard customers, financial regulators in Britain adopted tighter rules on Thursday regarding the marketing and sale of cryptocurrencies.

The Financial Conduct Authority presented a package of reforms for the industry, which has been under fire for a long time due to the lack of monitoring — as well as claims of large profits in an unstable environment.

According to the new regulations, beginning in October, businesses in Britain that promote crypto products or services have to provide clients a "clear warning" that they run the risk of losing money in "high-risk" investments.

In addition, the regulator is going to prohibit "refer a friend" bonuses, which are meant to encourage cryptocurrency investment in the long run.

“Our rules give people the time and the right risk warnings to make an informed choice,” said Sheldon Mills, head of consumers and competition at the FCA.

The news comes after the United Kingdom passed laws at the beginning of this year to put cryptocurrency marketing within the authority of the Financial Conduct Authority.

Legislators in the United Kingdom are pushing for the regulation of cryptocurrency investments in the country in a manner not dissimilar to that which governs the gaming sector.

Director of operations at industry organization CryptoUK Su Carpenter responded to the FCA statement by saying the new restrictions may discourage startups.

“There is a risk that this solution will both unfairly concentrate market power for those firms which are already authorized and potentially encourage unauthorized firms to operate from outside of the UK,” Carpenter said.