24 cryptocurrency companies under close attention of the FCA

The UK's Financial Conduct Authority (FCA) has joined global regulators around the world in clamping down on the free digital industry and has launched an investigation into twenty-four cryptocurrency companies.

The FCA did not specify the platforms to which the requests were sent, but assured that an investigation has been launched to “determine whether companies can engage in activities that require FCA authorization.” The department does not name criteria for assessing the activities of crypto companies, noting only that the priority of their actions lies within the framework of protecting consumer rights. There is also no specific information about the consequences of the ongoing inspection. Regulators may issue warnings against questionable companies, take legal action to freeze assets and businesses, or prosecute them.

The FCA's investigations are consistent with a number of proceedings launched in other major jurisdictions.

U.S. Canadainitiated a joint investigation into investment programs that pose a potential threat, “Operation Cryptosweep.” 

On May 24, the Central Bank in Singapore sent a warning to eight local crypto platforms, suspecting them of violating the securities law. US regulators have filed fraud charges against a number of ICOs.

The US Department of Justice (DoJ)has opened a criminal investigation into possible price manipulation by traders in the cryptocurrency market.

DoJ is examining methods that can be used to boost market prices, such as spoofing is when traders flood the market with fake orders to trick investors into buying or selling. Wash trading is when a trader buys and sells on his own orders, creating a false impression of market demand. 

The crackdown comes amid fluctuating prices, a hotly debated regulatory issue and a growing trend of dubious initial coin offerings (ICOs). To highlight the risks, the US Securities and Exchange Commission (SEC) recently launched a fake ICO website.

Meanwhile, a group of eight cryptocurrency platforms are trying to influence UK financial regulators. CryptoUK is lobbying for a transparent and reliable legal status for cryptocurrencies and clear rules for investors and businesses in the sector.