Crypto crackdown: UK regulator takes aim at leading exchange

Binance has been banned from regulated activities in the country amid focus on burgeoning cryptocurrency industry

Crypto crackdown: UK regulator takes aim at leading exchange
Steve Randall

Following a high-profile crackdown on cryptocurrencies by the Chinese government, one of the world’s leading crypto exchanges has been banned from regulated activities by the UK’s financial regulator.

Binance was told over the weekend that the Financial Conduct Authority (FCA) that it has until the end of the month to make it clear to customers of its Binance Markets Ltd unit, which is regulated by the FCA, that it is not authorized to carry out any regulated activities.

The FCA says that the wider Binance Group, which bought its UK regulated entity a year ago, is not regulated and has warned investors of the risks involved.

It’s the second time in a week that Binance has been targeted by regulators. Japanese officials said the firm was operating in its jurisdiction illegally.

Responding to the UK regulator’s announcement, a Binance spokesperson told Reuters that: "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.” The firm says that its main operations through its global website are not affected by the regulator’s action.

Cryptocurrencies have grown in popularity, especially with younger investors, but regulation is considered a key risk to their anonymous nature which is often part of the appeal. Consumers are also unsure of the usefulness of digital currencies.

The value of Bitcoin has been punished in recent weeks as regulators and environmentalists disrupt the path to mainstream adoption as an investment asset class and as a payment method. Early Monday, the coins were valued at just below $35K.

Mexican billionaire backs Bitcoin

Meanwhile, on this side of the Atlantic, Mexican billionaire Ricardo Salinas Pliego says that he wants his bank to be the first in the country to accept Bitcoin.

The Banco Azteca owner tweeted that he endorses the cryptocurrency and in a recent interview he said that Bitcoin should be “in every investor’s portfolio.” He also derided FIAT currencies as a “fraud.”