UK financial regulator issues warning to Binance over lack of any form of UK authorization, registration or licence to carry out regulated activities
The United Kingdom’s Financial Conduct Authority (FCA) announced that Binance can no longer provide regulated asset services in the UK. The announcement first surfaced late last week as part of the FCA’s ongoing review of crypto businesses. The FCA noted that the warning could be conditionally withdrawn if Binance submits an application before the deadline of 31 March 2022.
The prohibition was issued alongside a general warning to cryptocurrency users not to be misled by advertisements for crypto products. The regulator also stressed that it does not oversee the majority of firms that advertise and offer crypto services in the UK. The warning followed Binance’s earlier statement of intent to launch “Binance UK,” a platform intended to serve UK customers specifically.
The FCA has a reputation for closely scrutinising crypto firms, reflected in the relatively small number of such businesses formally registered in the country. Binance initially applied for permission to operate in the UK but later withdrew that application after lengthy deliberations. This is not the first warning Binance has received: the exchange withdrew from Ontario, Canada, in order to comply with local regulatory requirements.
A similar situation has unfolded in Japan, where all crypto firms must register with the Financial Services Agency (FSA) before starting operations. Recently, the FSA issued a second warning to Binance for conducting business in Japan without proper authorization. Non-compliance concerns about Binance have also been raised in other jurisdictions, including Germany, where authorities have warned the exchange it could face penalties for operating without an investor prospectus.
In response to these developments, Binance maintains that it adheres to the regulatory requirements imposed by the jurisdictions in which it operates.
“We adopt a cooperative approach with regulators and take our compliance obligations very seriously. We actively monitor changing rules and regulations in this emerging sector,” a Binance spokesperson said.
Last year the company blocked access to its platform for users holding US passports and later extended restrictions to all US citizens. Reports indicate that US authorities are closely scrutinising the exchange. Media coverage has suggested that Binance is currently under review by the IRS in relation to suspected money laundering and tax offences.