FCA extends deadline for crypto firms, but still pushing them offshore, says CryptoUK

Rick Steves

“An unprecedented 80% of the rest, that is 160 out of 200 British crypto companies have been asked to withdraw. The impact for those companies is that they will have to operate off-shore.”

The Financial Conduct Authority has intervened at the 11th hour to allow crypto asset firms in the UK who are appealing the regulator’s decision or have unusual wind-down requirements to continue trading on its temporary register.

The deadline for a final decision on approval had been set for 31 March, 2022, but the UK’s financial watchdog came under heavy fire in recent days as crypto firms and lobbies said the regulator was pushing them offshore.

Several leading players within the crypto space – including Copper, Blockchain.com, and Revolut – are still registered under the FCA’s temporary regime, which leads to uncertainty for the industry.

“We have concluded our assessments, and the TRR will close on 1 April, for all but for a small number of firms where it is strictly necessary to continue to have temporary registration. This is necessary where a firm may be pursuing an appeal or may have particular winding-down circumstances”, said the FCA.

A dozen firms currently occupy the TRR and more than 100 crypto firms applied for registration with the FCA once the government body became the authority with oversight over AML and CFT in the space. To date, 33 have been approved and more than 60 have been rejected or withdrew their applications.

160 out of 200 UK crypto firms have been asked to withdraw

Ian Taylor, Executive Director at CryptoUK, the UK’s independent crypto industry association, criticized the UK’s regulator: “The FCA has stated that it is given the 12 crypto firms still awaiting approval a period of time to either withdraw or appeal the FCA decision that they had not met the required standards.

“However, “. This means that there will be no consumer oversight if a UK citizen buys products from an online business domiciled in Malta, for example as they may still sell their services into the UK.

“Consumers will therefore have no recourse from the regulator, as the firm will operate outside the UK jurisdiction, which is bad for British consumer protection. This will also result in thousands of job losses at all of those 160 British crypto companies.

“This could also have another negative effect, in terms of illicit finance and sanctions avoidance. If the companies withdraw and move to less advanced regulatory environments, they will not be required to conduct globally accepted standards with regard to AML, KYC and transaction monitoring.

“It is unusual for the FCA to offer little support to companies trying to comply with their requirements. We need more transparency and guidance on best practice from the FCA so that companies that are already 90% compliant can be supported in reaching 100%.”

Read this next

Institutional FX

CLS FX volume continues downward trend in August

Total daily traded volume submitted to CLS for settlement took yet another step back in August.

Digital Assets

Huobi taps AstroPay to facilitate fiat-to-crypto payment in Latin America

Huobi, the world’s sixth-largest crypto exchange by trading volume, has recently partnered with payment solution provider AstroPay to launch local currency account deposits and withdrawals in Latin America.

Digital Assets

Crypto exchange FTX to raise $1 billion at flat valuation of $32 billion

FTX is reportedly in discussions with a clutch of heavyweights from traditional finance to raise up to $1 billion in fresh funding to fuel more deal-making.

Digital Assets

Revolut US launches trading on Avalanche, Solana, and Dogecoin

British fintech and banking firm Revolut has further expanded its cryptocurrency offering in the US with the addition of 29 new tokens.

Digital Assets

Bahrain greenlights eazyPay to launch Binance Pay

The Central Bank of Bahrain has blessed a new partnership inked by Binance with Eazy Financial Services ‘eazyPay’, a local POS and online payment service provider. The greenlight enables EazyPayto to launch Bitcoin and cryptocurrency payments in the region.

Digital Assets

Coinbase approved to offer crypto for Dutch users

Nasdaq-listed crypto exchange operator Coinbase has been handed regulatory approval to operate as a crypto service provider in the Netherlands.

Metaverse Gaming NFT

AC Milan partners with Solana-based NFT football game MonkeyLeague

“Partnering with champions like AC Milan, an absolute iconic Club throughout footballs history, is another testament to what we are building and where we are headed as a game and game studio. It also represents a key step in our plans to bridge the Web2 and Web3 worlds.”

Digital Assets

Shariah-compliant Islamic Coin to support SDG-compliant ventures, green projects, and philanthropy

Shariah-compliant Islamic Coin has recently launched a collaboration with the World Green Growth Organization and the International Youth Conference 6, taking place on September 22-25th and September 30th-October 1st, 2022, in New York. 

Market News

Week ahead: US core PCE and eurozone CPI 

We heard from a range of central banks last week and the update sparked big moves in the markets, and the bulk of the volatility was in currencies.