Fca Moves Against Htx In London Over Illegal Crypto Promotions

What Happened

The United Kingdom’s Financial Conduct Authority (FCA) has filed a lawsuit against several entities connected to the digital asset exchange HTX, formerly known as Huobi, accusing the platform of unlawfully promoting cryptoasset services to consumers in the United Kingdom.

The case, filed in London’s High Court on Tuesday, marks a rare civil action by the UK’s top financial watchdog against a major global exchange.

Under the UK’s Financial Services and Markets Act (FSMA), firms must not communicate any invitation or inducement to engage in investment activity unless the promotion is authorized or approved by a licensed entity.

Market Context

“This action is part of our commitment to protect consumers and uphold the integrity of UK financial markets.”

Since the implementation of the Financial Promotions Regime, the FCA has repeatedly warned exchanges, including Binance, KuCoin, and OKX, over unauthorized marketing.

The exchange has previously used the Huobi brand across several jurisdictions, raising concerns about how its marketing practices cross regulatory boundaries.

The latest legal escalation with HTX arrives as the FCA continues to tighten the gates on crypto market entry, with fewer than 100 firms given approval at the time of writing.

Why It Matters

Regulated institutions that choose to collaborate with unregistered crypto entities risk being drawn into enforcement actions themselves, facing severe compliance and reputational repercussions.

Details

According to the report, HTX breached the country’s financial promotions regime by targeting UK users without proper authorization or registration.

“The FCA has commenced civil proceedings in the High Court against HTX, a global crypto exchange, for unlawfully promoting cryptoasset services to UK consumers,” the agency said in an emailed statement.

The regulator’s move embodies its zero-tolerance stance toward overseas exchanges operating in the UK without registration or compliance oversight.

HTX’s Second Warning: FCA Lawsuit Indicates Tougher UK Stance on Crypto Ads

The FCA’s move follows multiple consumer alerts issued earlier this year, warning that HTX was operating without authorization while promoting its services to UK residents.

Additionally, Justin Sun, who serves as an adviser to HTX and is known for his close association with the Trump family’s digital asset ventures, is not listed as a defendant. Neither Sun nor his representatives have commented publicly on the matter.

But what exactly is the law defaulted by HTX?

This applies regardless of whether the company is based in the UK or abroad, so long as the promotion can influence UK consumers.

Violating this rule constitutes a criminal offense, carrying penalties of up to two years in prison, an unlimited fine, or both.

Also, the FCA has noted that many unregistered firms attempt to reach UK customers through online promotions, including websites and apps that embed on/off-ramp services from regulated partners.

The regulator argues that this model can mislead users into believing those unregistered platforms are operating legally.

That figure shows the regulator’s uncompromising stance on anti-money laundering (AML) and consumer protection standards, which many overseas firms have struggled to meet.

Crypto’s Compliance Struggle: Only 44 of 359 Firms Pass FCA’s Registration Test

Britain’s financial promotions regime for cryptoassets came into force after Parliament expanded existing rules to include digital assets.

Since then, the FCA has intensified enforcement, warning that only firms registered under the UK’s Money Laundering Regulations (MLRs) or authorized under FSMA can legally promote crypto services.

The FCA has faced challenges in bringing crypto activity under supervision. Between April 2023 and March 2024, the agency reported an 87% failure rate among crypto firms seeking registration under anti-money laundering rules.