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Crypto Asset Communications

November 2022

FINRA is conducting a targeted exam of firm practices regarding retail communications concerning Crypto Asset1 products and services.

Unless otherwise noted, the relevant period for each request is July 1, 2022 through September 30, 2022 (the “Relevant Period”). In addition, if your response varies over the Relevant Period, please explain the differences in your response.

  1. For the Relevant period, provide all retail communications2 that were distributed or made available by the firm or its affiliate(s) on its behalf that refer to, relate to, or concern a Crypto Asset or a service involving the transaction or holding of a Crypto Asset (“Communication”).
  2. Provide a numbered tabular list identifying each Communication provided pursuant to Item 1 above. Within the tabular list please:
    1. Include the date the Communication was first made available to the public:
    2. Identify whether or not the Communication was filed with FINRA’s Advertising Regulation Department. If the Communication was filed, include the FINRA Advertising Regulation reference number for the Communication;
    3. Indicate whether or not each Communication provided pursuant to Item 1 was approved by a registered principal of the firm. If so, provide the date of approval in the tabular list and provide separately records that reflect such approvals; and
    4. Identify each Crypto Asset and/or service involving the transaction or holding of a Crypto Asset that the Communication refers to, relates to, or concerns.
  3. Provide the firm’s written supervisory procedures concerning the review, approval, record keeping and dissemination of Communications in effect for any portion of the Relevant Period.
  4. Provide any compliance policies, manuals, training materials, compliance bulletins, and any other written guidance in effect for any portion of the Relevant Period concerning Communications.
  5. Provide any contracts or other written agreements in place between the firm and any affiliate concerning:
    1. The firm’s creation or dissemination of Communications on behalf of the affiliate or concerning services offered by the affiliate; and
    2. The affiliate’s use of information concerning the firm’s customers to determine who will receive Communications.

1 “Crypto Asset” means an asset that is issued or transferred using distributed ledger or blockchain technology, including, but not limited to, so-called “virtual currencies,” “coins,” and “tokens.” A Crypto Asset may or may not meet the definition of a “security” under the federal securities laws, provided, however, that the term “Crypto Asset” shall not include a security registered under the Securities Act and transferred through the system of a registered clearing agency.

2 “Retail Communication” is defined in FINRA Rule 2210(a)(5) as “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.