Binance crypto exchange responds to Barclays decision to stop payments

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Dive brief:

UK bank Barclays said in an emailed statement to Payments Dive on Tuesday that it was stopping debit and credit payments from UK customers to the Binance crypto exchange. The move follows a “consumer warning” from the UK’s Financial Conduct Authority (FCA) and aims “to help protect our customers’ money,” Barclays spokesman George Shorrock also said. .

In response, Binance spokeswoman Hazel Watts said on Tuesday the company was “disappointed” with Barclay’s “one-sided action”, based on what Binance claims was an “inaccurate understanding of events.” Binance is open to a “dialogue with Barclays” to resolve the issue, Watts said in the email.

The move comes after the FCA said in a June 26 press release that Binance Markets is not allowed to engage in regulated activity in the UK. A significant number of crypto exchange companies are withdrawing their request from the FCA due to their inability to keep up with the required anti-money. anti-money laundering regulations (AML), according to Bloomberg.

Dive overview:

Barclays Bank, one of the largest banks in the UK, has decided to block the ability of customers to make card payments to Binance which presumably fund consumers’ crypto purchases and exchanges on this exchange. The bank cited the FCA’s consumer warning against the crypto exchange as the basis for its action.

With effect from today, Barclays intends to stop credit and debit card payments to Binance, ”a Barclays spokesperson said in an email.“ This action doesn’t. has no impact on the ability of clients to withdraw funds from Binance. “

The FCA has asked Binance Markets, the UK crypto arm of the Binance group, to stop all “regulated activity” trading in the country unless it receives written consent from the regulator, according to the June 26 press release. .

Last year, Cayman Islands-based Binance bought a British crypto wallet firm, Swipe.io, for an undisclosed amount, in order to expand its operations in the country.

Binance “disappointed” and open to “dialogue”

“We are disappointed that Barclays appears to have taken unilateral action based on what appears to be an inaccurate understanding of events,” Watts said in the email. “They are referring their users to an FCA notice which was recently published and addressed to Binance Markets Limited (BML)” but which is a “separate legal entity” and separate from the products and services offered through the site www.binance.com of the company, Watts. said in the email.

Binance Markets applied to be registered with the FCA as a crypto exchange program last year. The company withdrew its request on May 17 due to 5MLD, an anti-money laundering directive, as reported by Banking Dive.

The crypto exchange argues that the FCA opinion relates to BML, which is a UK-incorporated company regulated by the FCA.

“We would be happy to have a dialogue with Barclays to discuss their concerns and hope the information above will help clarify the issue,” Watts said in the email. “We have always taken the safety of our users’ money very seriously.”

Binance also published a blog post from its CEO on Tuesday explaining how it seeks to “protect user interests” and meet evolving regulatory requirements.

Control increases for Binanceworldwide

Binance is facing increasing heat from regulators around the world. Regulators from the Financial Services Agency of Japan said Binance was operating illegally in the country.

The cryptocurrency exchange has also pulled out of Ontario, Canada’s most populous province, to avoid potentially not complying with Ontario’s securities laws, according to a report by CoinDesk. The company has “advised Ontario-based users to close all active positions.”, And users “will have until the end of the calendar year to withdraw their funds,” Watts said in the email to PaymentsDive.

South Korea is considering similar moves to regulate crypto exchanges, requiring companies like Binance to register with the country’s Financial Services Commission.

“We take our legal obligations very seriously and work with regulators and law enforcement,” Watts said in the emailed statement. “As the cryptocurrency ecosystem continues to grow and evolve, we are committed to working with regulators and policy makers to shape policies that protect consumers, encourage innovation, and move our industry forward. “

Other regulatory obstacles

Binance Joins Other Crypto Exchanges To Pull FCA Applications Due To Intensive AML Requirements.

A “significantly large number of crypto asset firms” are failing to meet necessary anti-money laundering standards, an FCA spokesperson told The Wall Street Journal. “Among the companies that we have evaluated to date, more than 90% have withdrawn their candidacy following our intervention.

Last month, the FCA said a drastically high number of cryptocurrency firms were not following UK money laundering rules, leading to the withdrawal of an unprecedented number of firms cryptography applications for registration with the regulator, according to the Financial Times.

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