The UK is set to implement sweeping cryptocurrency marketing regulations in October 2025, marking a pivotal moment in its financial regulatory landscape. As part of this shift, major crypto exchange Bybit announced on September 22 that it would proactively suspend services for UK users. This move reflects a broader industry response to stricter oversight by the Financial Conduct Authority (FCA), aimed at protecting investors while redefining how digital assets are promoted.
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The Regulatory Shift: What Changed?
On October 8, 2025, new rules under the Financial Services and Markets Act 2023 came into force, amending the original 2000 legislation to formally bring cryptoassets into the UK’s financial promotion framework. These changes grant the FCA authority over marketing activities involving qualifying cryptoassets—even when conducted by overseas firms targeting UK consumers.
Bybit stated:
“In light of the FCA’s Policy Statement PS23/6 on crypto promotion rules, Bybit has chosen to proactively comply with regulatory expectations and suspend operations in the UK market.”
This decision wasn’t made in isolation. The FCA had previously warned unregistered crypto firms about non-compliance, emphasizing its concern over foreign entities offering services to UK residents without proper authorization.
Key Elements of the New Crypto Marketing Rules
1. Restricted Financial Promotions
Under Section 21 of the FSMA 2000, no person may engage in financial promotions—defined as inviting or encouraging investment—unless authorized by the FCA or operating under an exemption. This applies broadly, covering:
- Social media posts and influencer campaigns
- Podcast appearances and conference sponsorships
- Online ads and referral programs
Even seemingly informal outreach can qualify as a “financial promotion” if it encourages investment behavior.
2. Who Can Promote Crypto Now?
Only the following entities may legally promote qualifying cryptoassets:
- FCA-authorized firms
- Registered cryptoasset firms compliant with Anti-Money Laundering Regulations (AMLR)
- Entities acting under specific exemptions in the Financial Promotion Order (FPO)
Notably, existing FPO exemptions for high-net-worth or sophisticated investors no longer apply to crypto promotions. The government plans to introduce separate, tailored exemptions for these groups.
3. Mandatory Risk Warnings & Cooling-Off Periods
To combat impulsive investing, the FCA introduced two critical safeguards:
Clear Risk Disclosures
Promotional content must include a prominent warning such as:
“Don’t invest unless you’re prepared to lose all the money you invest. This is a high-risk investment and you are unlikely to be protected if something goes wrong. Take two minutes to learn more.”
A clickable link to further risk information must also be provided.
24-Hour Cooling-Off Rule
First-time investors must undergo a mandatory 24-hour waiting period after requesting promotional material—classified as a Direct Offer Financial Promotion (DOPF)—before any follow-up communication or transaction is allowed. The clock starts only after the user explicitly consents to receive such materials.
This directly impacts common growth tactics like “refer-a-friend” bonuses and instant sign-up rewards, which are now prohibited.
Which Cryptoassets Are Affected?
The term “qualifying cryptoasset” covers any digital asset that:
- Uses cryptography for security
- Represents value or contractual rights
- Is transferable or exchangeable
Excluded assets include:
- E-money and fiat currencies (including digital forms)
- Non-transferable tokens (e.g., loyalty points redeemable only with the issuer)
- Assets already regulated as securities (stocks, futures, etc.)
Importantly, both decentralized projects (like Bitcoin and Ethereum) and centralized ones (such as ICOs) fall under the same rules. However, NFTs used primarily for art or collectibles may not be classified as qualifying cryptoassets, depending on use case.
Why Did Bybit Pull Out?
Bybit’s suspension of UK services highlights the operational burden of compliance. From October 1:
- No new account registrations from UK users
- Existing users barred from deposits or opening new positions
- Users encouraged to reduce or close positions and withdraw funds
Bybit explained:
“Suspending trading allows us to focus resources on meeting UK regulatory requirements effectively, with the goal of re-entering the market in the future.”
This strategic pause underscores the complexity of aligning global platforms with region-specific regulations—especially when penalties for non-compliance include unlimited fines or criminal prosecution.
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FAQ: Understanding the UK’s Crypto Regulation Changes
Q: Do these rules apply to overseas crypto companies?
A: Yes. Any firm promoting crypto to UK consumers—even from abroad—must comply. The rules have extraterritorial reach.
Q: Can I still trade crypto in the UK?
A: Yes, but only through FCA-compliant platforms. Some international exchanges have paused services; others are seeking authorization.
Q: Are NFTs banned under the new rules?
A: Not necessarily. Utility or artistic NFTs likely won’t be affected unless marketed as investments.
Q: What happens if a company breaks these rules?
A: Violations are criminal offenses, punishable by unlimited fines and up to two years in prison.
Q: Is the UK treating crypto like securities?
A: Not exactly. Unlike the U.S. SEC’s Howey Test approach, the UK focuses on promotion rather than classification—regulating how crypto is sold, not what it is.
Q: Will there be exceptions for expert investors?
A: The government intends to create new exemptions for high-net-worth and sophisticated investors, but these aren’t active yet.
Industry Impact and Future Outlook
While the UK hasn’t adopted the U.S.-style securities framework, it’s building a robust disclosure-based system focused on investor protection. This balanced approach aims to foster innovation while minimizing harm from misleading marketing.
Other exchanges beyond Bybit are reviewing their UK strategies—adjusting websites, revamping onboarding flows, and retraining marketing teams. Full compliance requires not just legal alignment but also backend systems to track user interactions and ensure messaging meets FCA standards.
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Final Thoughts
The October 2025 crypto regulations represent a turning point for digital asset oversight in the UK. By prioritizing transparency, risk awareness, and consumer safeguards, the FCA is shaping a safer environment for retail participation. For platforms like Bybit, temporary withdrawal may be the price of long-term re-entry under clearer rules.
As global regulators converge on stricter marketing standards, adaptability will define which crypto businesses thrive—and which retreat.
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