The number of investigations concerning digital currency firms by the U.K’s financial regulator, the Financial Conduct Authority (FCA), has seen a steep increase in the past year.
The Financial Times reported on October 7 that it had gotten data showing that the FCA is presently investigating 87 companies in the space, either as part of the initial examination or full enforcement investigations. That number is up 74 percent from a similar time in 2018, when the regulator was examining 50 cryptocurrency companies.
The information was purportedly given by David Heffron, partner at law firm Pinsent Masons, who told the FT that the spike in numbers “reflects the FCA’s increasingly hands-on and no-nonsense approach” to the digital currency industry.
Back in May, the FCA cautioned that there had been a three-fold increase in reports of online platforms fleecing investors with digital currency and forex scams. The 1,800 reported scams in 2018-2019 had given an increase to an estimate of £27 million ($33.2 million) in lost assets.
The watchdog said fraudsters, in general, utilize social media to market their schemes, frequently utilizing phony celebrity endorsements and pictures of luxury items to bait innocent investors.
The FCA also earlier published guidance for the cryptocurrency industry that explained which tokens fall under its jurisdiction, and which—like bitcoin and ethereum—don’t.