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New FCA Warning Targets Meme Coins Like PEPE, SHIB and DOGE

Tue, 07/18/2023 - 14:34
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Godfrey Benjamin
UK FCA has issued guideline that can impact meme coin promotion
New FCA Warning Targets Meme Coins Like PEPE, SHIB and DOGE
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The United Kingdom Financial Conduct Authority (FCA) has issued a new guideline with a warning specifically targeted toward combating the noncompliance of crypto memes with its promotional guidelines. As contained in the newly published guide, the FCA said it has discovered that there is a growing use of memes for many crypto communications without firms knowing it needs to comply with its guidelines.

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"We have seen memes and other similar communications circulated on social media with users often not realizing they are subject to our rules," the FCA stated.

The current positioning of the FCA is very tricky and may directly impact top meme coins like Dogecoin (DOGE), Shiba Inu (SHIB) and Pepe Coin (PEPE). These mega digital currencies were designed as an internet meme, and they typically communicate with their community with memes.

Per the position of the FCA, these meme coins will need to adhere to its guidelines or risk a two-year jail term. The guideline from the FCA states that crypto memes intending to promote any digital currency may need to add a disclaimer to comply with its advertisement standards.

Is this a headwind to worry about?

Introducing regulations by the FCA is not alien to established projects in the digital currency ecosystem, especially for tokens like Dogecoin (DOGE).

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Meme coins are largely volatile, and sharing memes always has a tremendous impact on the price movements of the underlying assets. This is especially true when the influence of top social media personalities like Elon Musk, who regularly shares Shiba Inu themes — which many consider a signal of the underlying asset — is brought into focus.

It remains unclear how the entire regulation will work out in extraneous situations such as those involving general communication from top personalities like Elon Musk, Mark Cuban and other notable influencers.

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About the author

Godfrey Benjamin is an experienced crypto journalist whose main goal is to educate everyone around him about the prospects of Web 3.0. His love for crypto was birthed when, as a former banker, he discovered the obvious advantages of decentralized money over traditional payments. With his vast experience covering various aspects of Web3, Godfrey's articles has been featured on, Cryptonews and Coingape, among others.