The United Kingdom Financial Conduct Authority (FCA) has published an update to its earlier warning on leading cryptocurrency exchange, Binance. It is to be recalled that on June 25, the FCA issued a warning saying that “Binance Markets Limited is part of a wider Group (Binance Group) and is not permitted to undertake any regulated activity in the UK.”
The regulator imposed a set of requirements on Binance following the warning, resulting in many of Binance’s fiat payment providers and banking partners cutting off users from depositing or withdrawing GBP from Binance.
In a follow-up update published today, the regulator said:
On 25 June 2021, the FCA imposed requirements on Binance Markets Limited. The firm complied with all aspects of the requirements.
Among the requirements imposed by the FCA is that Binance publishes an announcement on its website specifying that its subsidiary, Binance Markets Limited, is not licensed to serve customers in the UK. Binance published the said announcement on its website on July 1.
A section of the requirements also said the FCA found that Binance Markets Limited was “not capable of being effectively supervised,” since it forms part of “a global group which offers complex and high-risk financial products, which pose a significant risk to consumers..”
Binance Markets Limited is an entity that Binance registered in the UK, with the objective of setting up a region-focused exchange as they did with Binance US. However, the new company currently does not hold a license with the FCA as required by UK laws, hence the warning by the FCA.
In a statement to Bloomberg, Binance said,
As noted by the FCA, BML has fully complied with all aspects of its requirements. We continue to engage with the FCA to resolve any outstanding issues that may exist. As the cryptocurrency ecosystem industry continues to grow and evolve, we are committed to working with regulators and policymakers to develop policies that protect consumers, encourage innovation, and move our industry forward.”
Since the new UK entity has now complied with all aspects of the requirements by the FCA, the global Binance platform will likely continue to serve UK customers, even without an FCA license. Binance’s payment partners may also likely reinstate fiat gateways to the platform, pending the possible launch of a UK-focused arm of Binance’s business.
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