Key takeaways:
- The FCA approved a Kraken-owned subsidy in the UK.
- Crypto Facilities, a subsidiary of crypto exchange Kraken, has been granted an MLR license by the Financial Conduct Authority in the United Kingdom (FCA).
- As a result, Kraken can continue to offer derivatives trading through Crypto Facilities to its customers in the United Kingdom. But, of course, it’s one of the few companies having the necessary permits.
The leading financial regulators in the UK have given their clearance to Crypto Facilities, a wholly-owned subsidiary of major crypto exchange Kraken. Kraken is a cryptocurrency exchange and bank based in the United States that was created in 2011. The exchange facilitates cryptocurrency and fiat currency trading, as well as provides pricing data to Bloomberg Terminal.
Crypto Facilities has been at the forefront of Europe’s crypto regulation debate since its inception in 2014. It was the first crypto asset business to gain a Multilateral Trading Facility (MTF) license from the FCA in 2020, after being acquired by Kraken in 2019. As a result, institutional and professional investors in Europe were allowed to access regulated crypto derivatives after becoming a regulated venue for the first time.
Crypto Facilities has received an MLR license from the Financial Conduct Authority (FCA), indicating that it is now compatible with the UK’s anti-money laundering legislation, making it one of the select few crypto firms to have FCA approval.
The Financial Conduct Authority is a financial regulatory organization in the United Kingdom funded by financial services sector fees and works independently of the UK government. The approval is particularly significant for the Kraken exchange since it would allow the company to provide crypto derivatives services in the nation through its subsidiary. The FCA has strengthened its grip on unregulated crypto derivatives, causing many prominent crypto exchanges to stop offering them. As a result, Kraken would now be one of the few crypto platforms to provide derivatives services, providing it a much-needed market boost.
Crypto Facilities CEO Gary Worrall stated:
“The MLR registration effectively ticks all the right boxes for both current and prospective clients to continue trading crypto derivatives on the Crypto Facilities platform.”
He added, “It paves the way for us to enhance and expand our offering, ensuring clients have access to the various exposures that best fit their investment needs.”
Furthermore, the firm is now compliant with the country’s anti-money laundering legislation thanks to this license. This also applies to its cryptocurrency activities.
It also means that Crypto Facilities can adhere to the same anti-money laundering regulations as FCA banks.
“While the inflow of institutional funds into the cryptocurrency market has been remarkable over the past year, compliance and regulatory certainty remain a significant hurdle for many looking to gain exposure to digital assets,” Mr. Worrall claimed. “The MLR registration affirms Crypto Facilities’ commitment to regulatory compliance, providing assurances that we provide a safe and secure trading environment for crypto derivatives.”
Apart from Kraken’s Crypto Facilities, Mode Global Holdings, two Gemini businesses, Archax, Ziglu, and Digivault, as well as Diginex’s custody business, have all secured MLR licenses.
