What is financial promotion?

A regulated communication inviting or inducing someone to engage in investment activity, which in the United Kingdom must be issued or approved by an authorized firm and carry prescribed risk warnings.

The Financial Conduct Authority brought cryptoasset promotions into this regime from October 2023, adding a risk summary, a ban on incentives to refer friends, and a cooling-off period for first-time customers of a firm. The primary source is Financial Conduct Authority Policy Statement PS23/6.

The reason a buyer meets this term at all is the friction it creates. The sign-up screens, the risk warnings you cannot dismiss immediately, the categorization questions about your investing experience, and the wait before your first purchase are all this rule showing up in a product.

How it works

The regime applies to communications made in the course of business that invite or induce investment activity, and it reaches anyone promoting to United Kingdom consumers regardless of where the firm is based.

For cryptoasset promotions, Policy Statement PS23/6 sets out several requirements (source: Financial Conduct Authority Policy Statement PS23/6):

• A prescribed risk warning. Specific wording that cannot be edited, displayed prominently and not obscured.
• A ban on referral incentives. Refer-a-friend bonuses and new-joiner bonuses tied to investing are prohibited for cryptoassets.
• Client categorization. Consumers must self-certify as restricted, high net worth, or sophisticated before proceeding.
• An appropriateness assessment. The firm must test whether the consumer understands the risks.
• A cooling off period. First-time customers of a firm face a delay before they can act on a direct offer.

Firms that are not authorized in the United Kingdom must have their promotions approved by an authorized firm, and finding an approver has proved difficult, which is one reason several international venues restricted their United Kingdom offering rather than comply.

Other jurisdictions have their own versions of the same idea under different names, so the specifics do not travel. What travels is the pattern: warnings, an experience check, and a delay.

Example

Illustrative sign-up flow at a United Kingdom venue. You create an account and are shown a risk warning you cannot skip. You answer questions categorizing yourself and take a short assessment on how the product works. If you pass and it is your first time with that firm, a cooling-off period runs before you can complete a purchase. If you fail the assessment, the firm must not let you proceed on that basis, and retaking it immediately is not permitted.

Why it matters when you buy

These rules explain why a venue that serves other countries may be closed to you, why account opening takes longer than it used to, and why a promotional bonus you saw abroad is absent locally. Read the summary for your country at the jurisdiction pages and check what is actually available at the available-in pages.

Related terms

cooling off period — the delay before a first purchase, kyc — the separate identity requirement, geoblocking — how venues implement restrictions, reverse solicitation — the narrow exception firms rely on, mica — the European Union's parallel regime, casp — the European service provider category.

Questions

Why do I have to answer questions before my first crypto purchase?

Because United Kingdom rules require firms to categorize you and assess whether you understand the product before letting you proceed. The questions are a regulatory requirement, not a marketing survey.

Why did a bonus offer disappear for United Kingdom users?

Incentives to invest, including refer-a-friend and sign-up bonuses tied to cryptoasset purchases, are prohibited under the promotion rules. Firms withdrew them rather than breach the regime.

Does this stop me buying crypto in the United Kingdom?

No. It regulates how firms may promote and sell, adding warnings, checks, and a delay. Authorized and registered firms continue to serve United Kingdom customers under it.