Key Takeaways
- Bybit and PayPal have recently withdrawn certain services from the U.K
- The FCA has added 143 new entities to its warning list of non-authorised firms
The Financial Conduct Authority (FCA), the regulatory authority overseeing financial markets in the United Kingdom, has expanded its list of non-authorized firms that customers are advised to avoid. On October 8th, the FCA added 143 new entities to its warning list, which includes major cryptocurrency exchanges like Huobi-owned HTX and KuCoin. While the warning list urges users to avoid dealing with the firms mentioned.
This move comes in the wake of recent changes in regulations that temporarily allow crypto firms to authorize their own promotions within the country. However, this privilege is extended only to firms that are registered with the FCA as virtual asset service providers. The new regulations also require these firms to make substantial adjustments to their online platforms to ensure potential customers are adequately warned about the risks associated with crypto investments.
In the UK, firms engaged in “crypto asset activities” must either be registered with the FCA or have been granted temporary status to operate. The FCA has taken a firm stance on non-compliance, with Jayson Probin, crypto financial promotions lead at the authority, warning that illegal promotion to UK consumers could result in various consequences.
These may include placing firms on the FCA’s warning list, requesting the removal of websites, social media accounts, apps, and other promotional materials that breach the regulations, and taking enforcement actions.
According to the FCA, as of August, they had received a total of 291 applications for registration from crypto-related businesses since 2020. However, they approved only 38 of these applications, representing approximately 13%. The FCA’s list of registered crypto asset providers currently includes 42 entities, including well-known names like Bitstamp, Revolut, and Gemini.
The impact of these regulatory changes is being felt across the cryptocurrency industry. PayPal, a prominent player in the digital payments space, has temporarily halted crypto transactions for its UK customers as it works to ensure compliance with the FCA’s requirements.
Meanwhile, unregistered firms like ByBit have also announced the suspension of their services to UK clients. Luno, another firm not registered with the FCA, is taking similar steps by preventing some UK clients from making crypto investments.
