Binance Markets Ltd. was banned by the U.K.’s financial watchdog from doing any regulated business in the country, one of the most significant moves to date by a regulator amid a global crackdown in the crypto industry, reports Bloomberg.
Binance Markets has until the evening of June 30 to confirm that it has removed all advertising and financial promotions, according to the Financial Conduct Authority’s register. The exchange must also make clear on its website, social media channels and all other communications that it is no longer permitted to operate in the U.K. Binance Markets won’t be able to resume U.K. operations without prior written consent.
While the target of the restrictions is a separate legal entity from Binance — the world’s biggest crypto exchange by reported turnover — the FCA edict specifies that the notice must be put on Binance.com and communication channels including the Binance mobile and desktop applications.
Binance Markets “does not offer any products or services via the Binance.com website,” the global crypto exchange said Sunday on Twitter. “The Binance Group acquired BML May 2020 and has not yet launched its U.K. business or used its FCA regulatory permissions.”
A Binance spokesman said via email that the FCA’s notice restricts, but doesn’t remove, permissions owned by Binance Markets.
We take a collaborative approach in working with regulators and we take our compliance obligations very seriously.
We are actively keeping abreast of changing policies, rules and laws in this new space. (4/4)
— Binance (@binance)
June 27, 2021
The move extends a regulatory crackdown on the cryptocurrency sector amid concerns about its potential involvement in money laundering and fraud. Binance withdrew an application related to the 5MLD — an anti-laundering directive — on May 17 following “intensive engagement from the FCA,” according to the watchdog, which said the action had been in train for some time.
Growth Driver
Bitcoin gained on Monday, trading 5.1% higher at $35,309 as of 7:19 a.m. in Hong Kong. Crypto bulls often interpret tough regulatory action as a sign that the market is maturing, and say the potential for a more robust safety net may entice more investors to enter the space.
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Binance announced the acquisition of an FCA-regulated entity last June along with plans for the launch of Binance.UK.
“A significantly high number of cryptoasset businesses are not meeting the required standards under the money laundering regulations, which has resulted in an unprecedented number of businesses withdrawing their applications,” an FCA spokesperson said.
Of the firms assessed, more than 90% have withdrawn applications following the FCA’s intervention.
The Financial Times reported on the U.K. notice earlier.
Binance is being probed by several agencies in the U.S., Bloomberg News reported in recent months. And Japan’s Financial Services Agency issued a warning against Binance recently, saying it offered crypto services without registration.