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Thursday, August 5, 2021
Alternative Investments

Britain bans Binance’s UK operations

Binance

The FCA has said Binance cannot conduct any regulated activity and issued a warning to consumers about the platform

The UK’s Financial Conduct Authority (FCA) has issued a warning to consumers about Binance Markets and the wider Binance group.

The FCA has said Binance, one of the world’s largest cryptocurrency exchanges, cannot conduct any regulated activity and issued a warning to consumers about the platform, which is coming under growing scrutiny globally.

In a notice dated June 25, the FCA said Binance Markets Ltd, Binance’s only regulated UK entity, must not, without the prior written consent of the FCA, carry out any regulated activities, with immediate effect.

It also issued a warning to consumers about Binance Markets and the wider Binance group.

No other entity in the Binance Group holds any form of UK authorization, registration or license to conduct regulated activity in the UK. The Binance Group appear to be offering UK customers a range of products and services via a website, Binance.com, the warning said.

Binance said in a statement that Binance Markets, which it acquired in 2020, was not yet using its regulatory permissions, and that the FCA’s move would not impact services offered on its Binance.com website.

We take a collaborative approach in working with regulators and we take our compliance obligations very seriously. We are actively keeping abreast of changing policies, rules and laws in this new space, a spokesperson said.

Binance announced in June last year that it had bought an FCA-regulated entity and would use it to offer cryptocurrency trading services using pounds and euros.

While trading of cryptocurrencies is not directly regulated in Britain, offering services such as trading in cryptocurrency derivatives does require authorization.

The FCA has told Binance that it must also secure and preserve all records relating to UK consumers and inform the FCA this has been done by July 2.

The regulator did not explain reasons for taking these measures.

However, British citizens will still be able to access Binance’s services in other jurisdictions.

The FCA is stepping up its oversight of cryptocurrency trading, which has soared in popularity in Britain along with other countries around the globe.

Since January, the FCA has required all firms offering cryptocurrency-related services to register and show they comply with anti-money laundering rules. However earlier this month it said that just five firms had registered, and that the majority were not yet compliant.

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