Kraken Says UK Crypto Promotion Rules Like Cigarette Box Warnings — ‘You’re Going To Die’
Kraken’s co-chief executive officer Arjun Sethi has criticized the UK’s crypto market regime, and says the new rules make it harder for retail investors to participate in the space.
“In the UK today, if you go to any crypto website, including Kraken’s, you see the equivalent to a cigarette box [warning] — ‘use this and you’re going to die’,” the executive said in an interview with the Financial Times.
Risk Disclosures Are Important, But UK Rules Impact Transaction Speeds, Says Sethi
The UK’s Financial Conduct Authority (FCA) brought in financial promotion rules in late 2023. Under these new rules, crypto firms are required to post clear risk warnings and incentives to invest are banned.
Firms must also conduct appropriateness checks to assess whether customers understand the risks associated with digital assets.
Sethi agreed that risk disclosures are important, but said that too many hurdles could deter retail investors from entering the market at all.
“Because of the speed at which they have to do the transaction, it’s worse for consumers,” he said. ”Disclosures are important . . . but if there are 14 steps, it’s worse.”
The FCA says the rules help people understand both the benefits and the risks of crypto.
Calls To Loosen Rules Intensify As US Embraces Crypto
This is not the first time the FCA has faced criticism for its tight regulations. Many analysts have said that Britain’s stance is too cautious.
Calls to loosen regulations have also grown this year amid the embrace of the digital asset market in the US by the Trump administration.
Trump has delivered on campaign promises to become ”crypto president,” helping push through a slew of initiatives to create a friendlier regulatory environment for the industry.
Trump executive order to create White House crypto working group (Source: White House)
Among key initiatives were the setting up of a Strategic Bitcoin Reserve and the signing into law in July of the GENIUS stablecoin act, which provides a regulatory framework for the industry.
UK Moves At A Slower Pace Than The US
Earlier this week, the Bank of England published a consultation paper proposing a regulatory regime for sterling-denominated stablecoins.
But staying true to its cautious stance, the central bank warned that weakening stablecoin rules could threaten financial stability.
Its proposed regime was criticized by the crypto community because it places restrictions on stablecoin ownership.
Meanwhile, the FCA lifted a retail ban on certain crypto exchange-traded products in early October. Wealth managers have since shown heightened interest in the products.
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