According to one of Britain’s financial regulators, Binance, one of the world’s largest cryptocurrency exchanges, cannot conduct any regulated activity. As a result, the financial regulator issued a warning to consumers about the platform, coming under growing inspection globally.
In a notice released on June 25, the Financial Conduct Authority (FCA) said Binance Markets Ltd, Binance’s only regulated unit in the United Kingdom, “must not, without the prior written consent of the FCA, carry out any regulated activities… with immediate effect”.
The FCA also gave out a warning to consumers about Binance Markets and the broader Binance group.
Binance stated in a statement that Binance Markets, which it acquired in 2020, was yet to use its regulatory permissions and that the FCA’s move wouldn’t affect the services offered on its Binance.com website.
“We take a two-way approach in working with regulators and we take our compliance responsibilities really seriously. We are actively keeping up-to-date changing policies, rules, and laws in this new space,” a spokesperson said.
Binance declared in June 2020 that it had bought an FCA-regulated unit and would use it to offer cryptocurrency trading services using pounds and euros.
In the United Kingdom, providing crypto trading services is legal while trading cryptocurrencies still awaiting legalization.
The FCA told Binance by June 30 it must show a notice stating “binance markets limited isn’t permitted to undertake any regulated activity in the United Kingdom” on its social media channels and websites.
In addition, it must secure and preserve all records relating to the United Kingdom consumers. And inform the FCA it’s done by July 2. The financial regulator never explained why it had taken these actions.
However, British citizens will still access Binance’s services in other jurisdictions.
The FCA is increasing its oversight of cryptocurrency trading, which has ascended in popularity in Britain along with other countries around the world.
Since January, the FCA has required all crypto companies to register and show they observe the anti-money laundering rules. Still, earlier this month it said that just five firms had registered and that the majority were yet to comply.
Japan’s regulator on June 25 said that Binance was operating in the country illegally. A notice posted on Japan’s Financial Services Agency website showed.
Last month, Bloomberg reported, officials from the U.S. Justice Department and Internal Revenue Service, sought information from individuals with insight into Binance’s business.
In April, Germany’s financial regulator BaFin said the exchange risked fines for offering digital tokens without an investor catalog.
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