Bitcoin

UK Regulators Ban Binance, What Waits For Crypto Exchange?


Binance has been the largest crypto exchange in the entire world. However, despite not caring about its reputation, the UK’s Financial Conduct Authority (FCA) has forbidden from working in the country.

According to the regulator, Binance will no longer be allowed to conduct regulated activities in the country as of June 30, 2021.

BINANCE MARKETS LIMITED is not permitted to conduct any regulated activity in the UK

British residents who expected to use a cryptocurrency exchange platform to engage in derivatives trading could no longer access it. Speaking to CNBC, a Binance spokesperson stated:

“The FCA UK Notice has no direct impact on the services offered on Binance.com… our relationship with our users remains unchanged. We take a collaborative approach to working with regulators and take compliance obligations very seriously,” the spokesperson added. “We actively keep pace with changing policies, rules, and laws in this new space.”

However, cryptocurrency trading may still be possible since such activities are unregulated. But the FSA has warned Britons of unregulated players and encouraged them to withdraw their assets from such companies.

Apart from the recent British measure, financial regulators In the USA, Japan, and Canada, they are also investigating the exchange for non-compliance with regulatory requirements. The US Security and Exchange Commission also took the same action against Binance in April 2021.

Binance Ban Background

The Financial Conduct Authority requires every company providing financial services in the UK to register with it. The cryptocurrency exchange has not met this requirement and, as such, cannot operate in the country.

Binance and several other crypto exchanges have submitted their applications to the FCA to launch digital assets in the British market. However, many exchanges, including Binance, have pulled the apps. The reason is that they could not meet the FCA’s anti-money laundering requirements.

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Binance specifically withdrew its order on May 17, 2021. However, according to a spokesperson for the FCA, Binance has been under the surveillance radar for quite some time now.

So, the decision to ban them from conducting regulated activities in the UK market is not an automatic one. They also mentioned that the ban does not cover all Binance’s market activities.

A cryptocurrency exchange may still provide cryptocurrency trading services to British residents through the official exchange, which is not based in London.

Regardless, the financial regulator prohibits crypto exchanges from setting up a crypto exchange in the UK. Also, they have directed the UK department to shut down every advertisement taking place in the country by June 30, 2021.

What does the ban mean for the crypto industry?

From recent actions against Binance by financial regulators, the crypto industry should prepare for more regulatory battles with the authorities. Prior to the ban in the UK, the US Securities and Exchange Commission was investigating mutual tax and money laundering charges.

Binance has revealed that it has suspended its activities in Ontario, Canada. The Ontario Securities Commission has accused Binance and other cryptocurrency exchanges of not complying with regulations established to operate in the country.

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Also, the cryptocurrency exchange received another warning from the Financial Services Agency of Japan for its unauthorized operations in the country. All these pressures from the regulatory authorities are shaking the foundation of what cryptocurrency and blockchain technology stands for.

BNB is recovering from last week’s devastation | Source: BNBUSD on TradingView.com

The cryptocurrency industry aims to facilitate transactions without the involvement of third parties or intermediaries. Now, assigning operators to operate based on financial regulations has become a concern for crypto enthusiasts.

Despite the ban, Binance Currency (BNB) is showing resilience and seems to be recovering from the terrible last week.

Featured image from Pixabay, Charts from TradingView.com



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