OKX implements new rules for UK users
OKX, the world’s sixth-largest cryptocurrency exchange in terms of trading volume, has unveiled new rules for its United Kingdom-based users in response to regulatory requirements set by the Financial Conduct Authority (FCA).
Starting next week, UK users will need to complete an investor questionnaire to confirm their understanding of the risks associated with buying and trading digital assets. Additionally, a second questionnaire will assess the suitability of crypto investments for each user. Users who fail to complete these questionnaires or show their understanding of the risks will become ineligible to hold an OKX account.
This move is part of a broader trend among crypto exchanges to align with regulatory standards. Both Binance and OKX have committed to adhering to new FCA rules, which will become effective on January 8, 2024. In October 2023, Binance launched a dedicated domain for UK users and partnered with local peer-to-peer lending platform Rebuildingsociety. However, this initiative faced a setback when Binance paused the onboarding of new UK users following additional FCA restrictions on Rebuildingsociety.
Additionally, Bybit suspended its cryptocurrency services for UK users in the United Kingdom due to impending regulations from the country’s watchdog.
In contrast, OKX has taken steps to limit its token offering to approximately 40 assets and has implemented conspicuous risk warnings on its platform interface to comply with the forthcoming FCA regulations. Also last week, the platform said it will delist several privacy-focused cryptocurrencies, including Monero (XMR), Dash (DASH), and ZCash (ZEC).
The UK new regulations will impact crypto companies’ ability to engage with local customers, requiring them to be registered or authorized by the FCA when reaching out to U.K. clients. Some firms, like Luno and PayPal, have already adjusted their crypto operations in response to these changes.
Under the new rules, the financial watchdog introduced a 24-hour “cooling-off” period specifically for first-time investors. This pause allows investors to take a step back and reconsider their decision before proceeding with this type of risky investment. Additionally, the practice of offering ‘refer a friend’ bonuses will be prohibited.
The new regulations also require firms promoting crypto products or services to include a clear risk warning in their promotions and verify that individuals have the necessary knowledge and experience to invest in cryptocurrencies.
OKX is one of the largest cryptocurrency exchanges, trading at least $3 billion in crypto per day. The exchange currently lists a total of 482 trading pairs, but the latest delistings indicate a shift in its approach to privacy coins.