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British watchdog warns Binance about its activities

27 Jun 2021 : 14:20
3 min read
  • The exchange Binance has received a warning from the FCA in the U.K
  • According to the FCA, Binance is not allowed to offer its regulated services because the exchange failed to pass the FCA's approval
  • In Japan and Ontario, Binance has also got into trouble with local regulators

The UK’s financial watchdog has warned Binance that it can stop all regulated activities in Britain and pointed out that it shouldn’t be operating in the country.  This happened a day after Japan financial regulator issued a similar notice to the cryptocurrency exchange.

Binance needs to become authorized to continue its services in the U.K.

According to the FCA, Binance offers services through to UK customers. And this is not allowed because Binance failed to pass the FCA’s approval. The main reason why Binance is regulated by the watchdog is because they offer crypto derivatives such as futures contracts. In the United Kingdom a firm needs to be authorized to offer these products to its clients and the FCA says that this needs to happen if Binance wants to continue its services in the U.K.

The Financial Conduct Authority intervention in recent days is one of the most significant steps taken by any global regulator against Binance, a major digital asset firm with offices around the world. The exchange has until Wednesday evening to confirm that it has complied with the regulator’s demands, and removed its advertising.

Other countries’ regulators have also warned Binance about its activities

Japan’s financial regulator has also warned Binance that it is operating in the country without permission. The warning, issued on Friday, states that the exchange has been offering crypto exchange services in the country without registering with the FSA. This warning is almost identical to the one given in the United Kingdom by the FCA. This is also the second warning for Binance by the Japanese financial regulator. The crypto exchange giant received its first FSA warning in March 2018

The exchange also had to halt its activities in Ontario because the Ontario Securities Commission had begun taking legal action against unregistered crypto exchanges in recent weeks, including Bybit, Poloniex and Kucoin. The regulator claimed that these exchanges failed to comply with provincial securities laws. Binance’s move suggests the crypto exchange operator does not want to register with the Ontario Securities Commission and comply with provincial securities laws.

Binance has responded to the situation on Twitter

According to the exchange, nothing will immediately change for British customers. Binance always responds in the same way with these types of stories, and they noted that they take compliance seriously and try to work with local regulators. It also states that The FCA UK notice has no direct impact on the services provided on Binance.  

About Author

Stan Colenbrander

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Stan is the head of news and podcast host at Cryptonary. He was formerly a member of the Cryptonary Pro community. In early 2021, he decided to drop out of journalism school at university to pursue journalism in real life and make an impact in the crypto space. . His areas of interest include the NFT industry, decentralised finance, and crypto start-ups.

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