The Financial Services and Markets Authority (FSMA), Belgium’s financial markets watchdog, starting May 17, 2023, will begin enforcing a new regulation aimed at monitoring advertisements (ads) targeted at consumers in Belgium. This comes after the regulation was approved by a Royal Decree on February 8, 2023.
In a webinar held on Wednesday, the regulation shared some details on the regulation, noting that the new rules relate to adverts intended to attract crypto investments and released either “as a regular professional activity or an occasional basis for compensation.”
According to FSMA, while the new regulation covers virtual assets that function as a means of exchange or payment, such as Bitcoin or Ether, assets with only a utility function or serve as securities are exempted.
The regulatory agency said it created the regulation because cryptocurrencies are “a particularly risky investment asset” popular among Belgians who are mostly younger investors. The regulator added that last year’s crypto winter and FTX bankruptcy “have hardly undermined faith in virtual currencies.”
FSMA Seeks to Regulate Contents of Crypto Ads
According to the details shared in a presentation at the webinar, FSMA must be notified 10 days before a crypto ad that is to be published by a trading platform or an influencer is posted on various media channels such as social media, billboards and websites.
The watchdog noted that it requires such messages to be clearly labelled as advertisements and carry important warnings such as on the volatile nature of digital assets, the lack of bank guarantee for them and legal mechanisms to prevent market manipulation or insider dealing.
As part of the regulatory process, the FSMA will require crypto advertisers to keep for at least a year their ad materials, agreements and the list of platforms where they were disseminated.
FSMA on Crypto
FSMA’s new regulation on digital asset advertisement is the regulator’s latest effort to supervise the emerging crypto industry. As early as 2020, the FSMA called for government regulation of cryptocurrencies, noting that the size of the digital asset market called for attention.
In April 2022, the regulator began to require all crypto firms operating in the country to register to continue their activities. Months later, the markets supervisor started consulting on how to classify digital assets.
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