According to the news platform iNews, British MPs and campaigners are lobbying the British government to take a tougher stance on the burgeoning crypto industry.
Growing concerns within the UK
“It’s the Wild West, this gray area between highly leveraged financial investments on the one hand and these products that can be considered gambling”, Conservative MP Richard Holden told iNews. “There must be a clear distinction to protect people,” he added.
Matt Zarb-Cousin, a former associate of Jeremy Corbyn, a former Labor Party leader, specifically targeted football clubs’ growing interest in fan tokens.
Fantokens are essentially cryptocurrencies associated with a football club. Some of the biggest football clubs in the world have already spent more than $350 million on fan tokens. However, they have proved controversial.
“It is bad for football clubs to promote gambling for fans, which can lead to people destroying their lives. It is even worse to offer a pathway to cryptocurrency by pretending to empower them in a completely unregulated area.” According to Zarb-Cousin.
This is not the first time that the crypto industry has caused a stir in the UK.
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The UK’s Tense Relationship With Crypto
For the past 12 months, the UK has viewed the crypto industry with skepticism.
In January 2021, the Financial Conduct Authority (FCA) published five concerns about the crypto industry. This included the alleged lack of consumer protection and misleading advertising.
The regulator has also cracked down on Binance, one of the largest and most well-known crypto exchanges. In the summer of 2021, the FCA said it had a “big problem” with Binance’s lack of headquarters.
In September, the FCA reinforced its point. It said Binance was “unable” to be regulated after a UK entity of Binance failed to provide basic information to the regulator.
Binance has since said it is trying to resolve matters with the FCA. So far, there is no evidence that their efforts have worked.
When it comes to deceptive advertising, the FCA is not the only authority concerned about crypto.
The Advertising Standards Authority (ASA) has been chasing Coinbase, Papa Johns, eToro and several crypto firms for the past 12 months for their crypto advertising strategies. Miles Lockwood, director of complaints and investigations at the ASA, said:
“We see this as a critical and priority area for us. Where we run into problems, we will act hard and fast.”
Criticism of football teams and fan tokens
Binance, Coinbase and household brands such as Papa Johns have faced crypto-related criticism in the UK. But recently, Arsenal FC has also come under fire after the launch of its AFC fan token.
In December 2021, the advertising watchdog banned Arsenal FC’s tokens ads. It said the ads “played down investment in crypto assets and took advantage of consumers’ inexperience and gullibility”.
Whether other well-known fan-token teams such as Barcelona and Paris Saint-Germain will face similar setbacks remains to be seen.