FCA turns to TikTok and YouTube to warn about cryptocurrency

Young woman sat at laptop by a window

If you can’t beat them, join them! It appears the UK financial regulators are attempting to ‘get down with the kids’ as they search for new ways to warn about the dangers of cryptocurrency investing.

Here’s what the FCA is planning to do with its new campaign and what it hopes to achieve by educating younger investors.

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What is the FCA?

The Financial Conduct Authority (FCA) is the main regulating body for financial services in the UK.

You may think that they are just a bunch of out-of-touch oldies, but their whole purpose is to protect regular people like you and me.

They regulate financial products and companies to make sure that we don’t get stung by crooks, scams or even just bad financial advice!

What is the FCA’s stance on cryptocurrency?

As one of the riskiest and most volatile assets available to investors, the FCA is not the biggest fan of crypto.

Some might view this as a backwards stance and assume that they ‘just don’t get it’. But the truth is that a lot of people have lost a significant amount of money in the cryptocurrency space.

Of course, there are many success stories, but the lack of regulation means it’s easy to be taken advantage of.

How is the FCA trying to improve the cryptocurrency market?

The FCA is doing what it can to put a stop to some of the worst losses, and it’s trying to educate investors on the risks involved.

Broader regulation for cryptocurrency is in the works. But until the FCA is able to get the crypto world under control, it’s worth heeding their advice to proceed with extreme caution.

It’s not just shady characters that are taking investors’ money: some legitimate crypto projects have simply been rubbish. The creators likely didn’t set out to fail, but when a digital token tanks, ordinary investors are usually the ones left holding the bag.

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Why is the FCA using TikTok and YouTube?

Over the last year or so, streams of new investors have jumped into the markets.

However, a lot of young investors have leapt in at the riskiest end of the investing spectrum. Not only that, but they’re getting a lot of their investing info from places like TikTok and YouTube.

Social media can be an amazing tool for spreading information. But it’s just as easy to spread misinformation or even irresponsible ideas.

Because many younger investors spend their time on these platforms, the FCA is trying to reach them where they think their message will get the most eyeballs and have the most impact.

What will be in the new cryptocurrency campaign?

As reported by iNews, the recently launched ‘InvestSmart’ campaign aims to empower younger investors to make better decisions.

The idea isn’t just to scare away young investors and tell them they don’t belong. Investing is, and should be, for everyone! What the FCA is trying to do is make sure that these investors are armed with reliable information.

Losing cash in high-risk investments such as cryptocurrency isn’t good for anyone. No one wants to see that happen. So a proper understanding of risks for retail traders and how markets work should do two things:

  1. Help younger investors avoid losing money
  2. Allow investors to make more money over time with better investing knowledge

Investing in Cryptocurrency is extremely high risk and complex. The Motley Fool has provided this article for the sole purpose of education and not to help you decide whether or not to invest in Cryptocurrency. Should you decide to invest in Cryptocurrency or in any other investment, you should always obtain appropriate financial advice and only invest what you can afford to lose.

The post FCA turns to TikTok and YouTube to warn about cryptocurrency appeared first on The Motley Fool UK.

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