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Binance is the world’s largest crypto exchange. However, regardless of his reputation, the UK’s Financial Conduct Authority (FCA) has banned him from operating in the country.
According to the regulator, Binance is no longer authorized to conduct regulated activities in the country as of June 30, 2021.
“BINANCE MARKETS LIMITED IS NOT AUTHORIZED TO UNDERTAKE ANY REGULATED ACTIVITY IN THE UK”
UK residents who expected to use the cryptocurrency exchange to engage in derivatives trading can no longer access it. Speaking to CNBC, the Binance spokesperson said:
“FCA UK’s advice has no direct impact on the services provided on Binance.com… Our relationship with our users has not changed. We take a collaborative approach in working with regulators and take our compliance obligations very seriously, ”added the spokesperson. “We actively keep abreast of changes in policies, rules and laws in this new space.”
However, crypto trading might still be possible as these activities are not regulated. But, the financial watchdog has warned Britons against unregulated gamblers and encourages them to pull their assets out of these companies.
In addition to the recent UK action, financial regulators in the US, Japan and Canada have also polled the stock market for failing to comply with regulatory requirements. The US Security and Exchange Commission also took the same action against Binance in April 2021.
Background to the Binance ban
The Financial Conduct Authority requires every company offering financial services in the UK to register with it. The cryptocurrency exchange has not fulfilled this requirement and as such cannot operate in the country.
Binance and many other crypto exchanges have submitted their requests to the FCA to launch digital assets in the UK market. However, many exchanges, including Binance, have withdrawn the applications. The reason was that they could not meet FCA anti-money laundering requirements.
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Binance specifically withdrew its candidacy on May 17, 2021. However, according to the FCA spokesperson, Binance has been under the watchdog’s radar for some time now.
Thus, the decision to ban them from exercising regulated activities on the UK market is not spontaneous. They also said the ban did not cover all of Binance’s activity in the market.
The cryptocurrency exchange could still provide crypto trading services to UK residents through its official exchange, which is not based in London.
Either way, the financial regulator bans the cryptocurrency exchange from establishing a crypto exchange in the UK. In addition, they have given direction to the UK division to shut down all ads running in the country by June 30, 2021.
What does the ban mean for the crypto industry?
Following recent actions against Binance by financial regulators, the crypto industry must prepare for more regulatory battles with the authorities. Prior to the UK ban, the US SEC investigated the swapping of tax and money laundering charges.
Binance even revealed that it was shutting down operations in Ontario, Canada. The Ontario Securities Commission has accused Binance and other cryptocurrency exchanges of failing to comply with the regulations in place to operate in the country.
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Additionally, the cryptocurrency exchange has received another warning from the Financial Services Agency of Japan for its unauthorized operations in the country. All of this pressure from regulatory authorities is shaking the foundations of what cryptocurrency and blockchain technology stands for.
BNB Recovers From Last Week’s Destruction | Source: BNBUSD on TradingView.com
The cryptocurrency industry aims to facilitate transactions without interference from third parties or intermediaries. Now, forcing operators to operate on the basis of financial regulations is becoming a concern for crypto enthusiasts.
Despite the ban, Binance Coin (BNB) is showing resilience and appears to be recovering from the terrible last week.
Featured Image from Pixabay, Charts from TradingView.com
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