Internationally renowned and world’s most popularly used bitcoin exchange and altcoin cryptocurrency exchange Binance is alleged with “money laundering and tax offences’ ‘, in May 2021. Several countries displayed their concerns regarding the regulations of Binance, finally, the “financial watchdogs” have asked the company to put a complete stop on practising all regulated activities in Britain, United Kingdom (UK).
The Financial Conduct Authority (FCA) [colloquially known as Britain’s Financial Watchdog, the organization regulates and maintains the integrity of about 60,000 financial institutions, firms, and markets] has issued a “consumer warning” against the Cayman Islands-registered Binance holdings company and Binance Markets Ltd.
The cryptocurrency exchange company has been prohibited from operating in the country. It is not often that a regulatory institution asks a company to absolutely stop all its activities. FCA gave Binance the deadline till Wednesday evening to eradicate all its existing banners, financial promotions from the geopolitical boundaries of the UK.
They are also asked to make it clear on their website and all the socials that “Binance is no longer permitted to operate in the UK”. (Stated by FCA) The regulators later added and stated, “no other entity in the Binance Group holds any form of UK authorization, registration or license to conduct a regulated activity in the UK”. A report from Bloomberg said that Binance had plans to launch a “Binance. The UK” which would have been an “FCA-regulated entity” last June. Well, this seems a far-fetched plan now. As they won’t be allowed to operate unless FCA provides the respective alleged company with written consent.
Binance’s Stance On This Situation
On June 27, 2021, Binance posted four tweets on its Twitter account with a firm reply to this whole case. Here quoted directly from Binance’s comments on the social media account:
“We are aware of recent reports about an FCA UK notice in relation to Binance Markets Limited (BML).
BML is a separate legal entity and does not offer any products or services via the http://Binance.com website.”
“The Binance Group acquired BML May 2020 and has not yet launched its UK business or used its FCA regulatory permissions.
For questions related to BML, please contact [email protected].”
“The FCA UK notice has no direct impact on the services provided on http://Binance.com.
Our relationship with our users has not changed.”
“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.”
Financial Conduct Authority’ Prerequisite And Affirmations
The crypto exchange firm Binance has grown rapidly into the cryptocurrency and Bitcoin market. However, any firm that operates in the financial sector must get registered and authorized by the FCA. in this case, Binance Markets ltd. is not registered under the financial watchdog.
One of the spokesmen of FCA said, “A significantly high number of crypto assets businesses are not meeting the required standards under the money laundering regulations, which have resulted in an unprecedented number of businesses withdrawing their applications”. Similarly, Binance had applied to get registered under the regulators to become an approved cryptocurrency company. However, they withdrew their applications after “intensive engagement by FCA”.
This legislation by the regulators is followed after warnings from other countries regarding Binance’s shortcomings in its operations of financial trade. Japan’s Financial Services Agency (FSA) put forward its concerns publicly regarding the cryptocurrency exchange platform conducting unauthorized trade with Japanese citizens. Binance was warned twice by the FSA. Another significant country, Germany’s financial regulator BaFin said that the company is involved in violating security rules over its launch of trading in stock tokens (according to data from Financial Times).
All these country’s decisions of the financial regulators are a step closer to wearing off of the cryptocurrency global framework and ecosystem. Bitcoin rates have risen slightly as a consequence of many countries making it a legal tender in their jurisdiction. There are several countries influenced by one another to promote and embrace the cryptocurrency market. Whereas several other countries are clamping down on crypto. This distinct demarcation of financial power will soon emerge in global politics and with time, spectators can see what turn this takes.