Binance halts new UK sign-ups to avoid regulatory headache
Binance has stopped onboarding new UK-based users following the termination of a partnership that would allow the platform to conform with new regulatory standards in the country.
This decision, effective from 5 p.m. London time on Monday, effectively prevents new users in the UK from accessing Binance’s offerings. Existing UK users, while retaining access to the current range of services, will not be introduced to new products or services on the platform.
This shift in strategy restricts Binance’s expansion in one of the most influential crypto markets outside of the United States. The underlying cause of this change stems from Binance’s association with Rebuildingsociety.com, a company it had collaborated with to ensure the approval of its advertisements and promotions under the new UK regulatory rules. However, the UK’s Financial Conduct Authority (FCA) indicated that Rebuildingsociety.com lacks the necessary authority to sanction crypto-related ads.
Further intensifying the situation, the FCA last week clamped down on Rebuilding Society – a different entity but often confused with Rebuildingsociety.com due to its similar name. The FCA directed the firm to retract its current approvals related to crypto financial promotions. This regulatory move makes it clear that Rebuilding Society can’t endorse content related to qualifying crypto assets, particularly if it’s communicated by an unauthorized individual.
“We are working closely with the FCA to ensure that our users are not harmed by these developments and are looking to find another suitable FCA authorized firm to approve our financial promotions as soon as possible,” the exchange said.
Additionally, Binance introduced a new domain for its users in the United Kingdom, www.binance.com/en-GB, to offer access to products and services that comply with the new marketing rules. These services include fiat and crypto deposits and withdrawals, spot trading, margin trading, Binance Pay, and crypto loans, among others. However, some Binance services will no longer be accessible to users in the UK, including Binance gift cards, academy, research, feed features, and referral bonuses.
Under the new set of rules, which took effect over the weekend, cryptocurrency companies wishing to run their promotions and advertisements need to be registered with the FCA. This registration would allow these companies to autonomously approve their marketing materials. However, for those crypto entities not registered with the FCA, there is a provision permitting their ads to be sanctioned by firms that are authorized by the regulatory body.
Binance, through its partnership with Rebuildingsociety.com, intended to tap into this latter provision, but the FCA’s latest statement suspended those plans.