Section 21 FSMA

Definition ∞ Section 21 of the Financial Services and Markets Act (FSMA) prohibits unauthorized persons from promoting financial products in the UK. This UK regulation requires that any communication inviting or inducing people to engage in investment activity must either be issued by a firm authorized by the Financial Conduct Authority (FCA) or approved by such a firm. In the context of digital assets, this means that promotions for cryptocurrencies or related services that qualify as financial promotions under UK law must comply with these strict requirements, aiming to protect consumers from misleading or harmful advertisements. Non-compliance carries significant legal consequences.
Context ∞ The discussion surrounding Section 21 FSMA is highly relevant for digital asset businesses targeting the UK market, particularly after recent amendments brought certain crypto promotions within its scope. Key debates address the precise scope of “financial promotion” in the digital asset space and the challenges for overseas firms marketing to UK consumers. A critical future development is the ongoing clarification from the FCA regarding how this section applies to various crypto products and services, aiming to establish a robust and clear regulatory perimeter.