Binance cryptocurrency exchange banned by UK regulator

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Changpeng Zhao, CEO of Binance, speaks during a TV interview in Tokyo, Japan on Thursday, January 11, 2018.

Akio Kon | Bloomberg | Getty Images

LONDON – The Binance cryptocurrency exchange has been banned from operating in the UK by the country’s market regulator, as the latest sign of a growing crackdown in the crypto market around the world.

The UK Financial Conduct Authority announced on Saturday that Binance Markets Limited, the UK division of Binance, “is not allowed to conduct regulated activities in the UK”.

As of June 30th, the company, which already offers British crypto trading through its website, must add a notice prominently on its website and apps that shows UK users the following text:

BINANCE MARKETS LIMITED CANNOT DO REGULATED ACTIVITIES IN UK COMPANIES Due to the requirements of the FCA, Binance Markets Limited is not currently permitted to conduct any regulated activity without the prior written consent of the FCA. (No other Binance Group company has any form of UK authorization, registration or license to conduct regulated activities in the UK).

Binance, the world’s largest crypto exchange by trading volume, should launch its own marketplace for digital assets in the UK. However, it was one of several crypto firms to withdraw applications for registration with the Financial Conduct Authority for failing to meet anti-money laundering requirements.

“Binance Markets Limited withdrew their 5MLD application on May 17, 2021 after intense commitment from the FCA,” a spokesman for the FCA told CNBC. “The actions taken today at Binance Markets Limited have been going on for some time.”

The FCA spokesman made it clear that the scope of the ban is limited. Although Binance Markets Limited is banned from offering regulated services in the UK, unregistered businesses can still interact with UK consumers. That means Binance could continue to offer crypto trading to the British through its website.

A Binance spokesperson told CNBC, “The FCA UK notice has no direct impact on the services provided on Binance.com … Our relationship with our users has not changed.”

“We take a cooperative approach to working with regulators and we take our compliance obligations very seriously,” added the spokesman. “We are actively keeping up to date with changing policies, rules and laws in this new space.”

The FCA isn’t the only regulator taking action against the crypto industry.

The Japanese financial services authority warned last week that Binance was operating in the country without their permission.

Meanwhile, China has stepped up its efforts to stamp out crypto speculation, ordered digital currency mines to cease operations in a number of regions, and urged banks and payment companies not to offer crypto-related services.

Increased regulatory control has put a strain on the emerging crypto market. Bitcoin had a solid start to the year, hitting an all-time high of nearly $ 65,000 in April. But the value has almost halved since then, and stands at $ 34,783 as of Monday morning.