Cryptocurrency Firms Face Key Regulatory Deadline In U.K.
Posted On March 24, 2022
Multiple cryptocurrency firms could be forced to cease operations in the United Kingdom if they fail to register with a financial watchdog by March 31.
Starting next week, firms operating cryptocurrency services in England must be registered with the Financial Conduct Authority (FCA), which is tasked with combatting money laundering.
Last year, the regulator extended the deadline allowing firms on a temporary register to continue trading while they sought full authorization. However, the FCA said many cryptocurrency companies have withdrawn their applications as they do not meet the required anti-money laundering standards.
Now, with just days to go until the deadline arrives, the fate of firms on the temporary register — including $33 billion U.S. fintech firm Revolut and Copper, a cryptocurrency start-up that counts former U.K. Finance Minister Philip Hammond as an advisor — hangs in the balance.
Critics say the British regulator has been slow to approve applications and is often unresponsive to inquiries and questions from cryptocurrency companies.
The FCA has said that it has approved just 33 cryptocurrency firms’ applications. More than 80% of the firms it has assessed to date have either withdrawn their applications or been rejected. And companies are still withdrawing their applications.
Firms that have had their applications rejected by the FCA can appeal, but the process is a long one and could need to go through the courts. A court tribunal recently sided with the FCA’s decision to refuse an application from the cryptocurrency exchange Gidiplus.
Gemini, the cryptocurrency exchange operated by twin brothers Tyler and Cameron Winklevoss, was among the first firms to get approved by the FCA.