FINRA Targets Crypto Company Communications After The FTX Crisis

Following the demise of industry titan FTX, the Financial Industry Regulatory Authority (FINRA) is focusing on crypto marketing tactics.

According to an announcement made on Monday, FINRA is asking some companies to provide all retail communications concerning crypto assets.

“Retail Communication any written (including electronic) communication that is distributed or made available to more than 25 retail investors within any 30 calendar-day period.

In addition to written communications, video, social media, mobile applications, and websites generally fall into this communications category.”

The US self-regulatory body has asked that companies provide detailed supervisory processes for the review, approval, record-keeping, and distribution of communications, together with any pertinent compliance rules or documents.

Additionally, it asked for details on any agreements made with affiliates about the creation or distribution of the messages, as well as any insight such affiliates may have into the intended audience.

According to its website, FINRA carries out “sweeps,” or focused examinations, like this one, to gather the data required to identify a regulatory response to emergent risks. To lessen the regulatory burden on the majority of organizations, FINRA stated on its website that its investigations are restricted to a small number of companies.

The investigation into whether any retail crypto goods or services were improperly marketed got underway on November 14.

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Harold

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