Binance is making efforts to gain trust of UK regulators, says CZ
Binance CEO Changpeng Zhao said the world’s largest cryptocurrency exchange has filled for a license from Britain’s Financial Conduct Authority, a few months after the FCA banned its operations.
CZ expects Binance’s London-based affiliate to become a registered crypto asset firm in six to 18 months, he told The Telegraph in an interview published Saturday.
“We’re making a number of very substantial changes in organizational structures, product offerings, our internal processes and the way we work with regulators,” Zhao said. “We want to continue to establish a presence in the U.K. and serve U.K. users in a fully licensed and fully compliant manner,” he added.
While the influential platform was technically allowed to continue offering trading to UK users, it was one of several crypto exchanges that were ordered to withdraw applications to register with the FCA due to not meeting anti-money laundering requirements.
Binance CEO also revealed that they have established a UK office and expanded its regulatory compliance manpower and advisory board with a number of local ex-regulatory staff.
Since clashing with the FCA in June, Binance was obliged to add a notice in a prominent place in its website and apps informing Brits that it’s not approved to offer them any services.
At the time, Binance clarified that the FCA notice would have no direct impact on the services it provides in the country from its website Binance.com. The exchange also explained that the regulator requires BML to seek prior written consent in order to undertake any regulated activities in the UK.
Just seven cryptocurrency-related companies are currently registered with Britain’s financial regulator. However, there are dozens of other crypto firms registered under the Temporary Registration Regime list.
A backlog of licensing applications
Crypto asset firms may still be registered with the FCA via a temporary regime. This regime was extended in June to address the fact that a significantly high number of businesses are not meeting the required standards under the Money Laundering Regulations resulting in an unprecedented number of businesses withdrawing their applications.
Binance too was unable to meet the AML requirements set up by the FCA. This becomes clear in the regulator’s letter to Binance Markets Limited, the group’s UK arm, pointing out the firm ‘refused’ to respond to basic questions including the ones relating to money laundering, organizational structure, and even the legal entity in charge of its product offering.
Since January 2020, the Financial Conduct Authority has been tasked with overseeing Anti-Money Laundering compliance for the UK’s crypto sector. At the time, the FCA kicked off a registration scheme for crypto-asset firms with an initial deadline of one year.
Amid a backlog of licensing applications, the FCA has extended its temporary licensing regime until March 2022 for firms whose applications haven’t yet been approved to allow them to continue trading.
However, nearly 70 crypto businesses had withdrawn earlier submitted filings for registration as the country tightens its regulation on the space. By retracting their applications, these firms had to cease operation in the UK, though dozens are still being assessed by the FCA.