Binance, one of the world's leading cryptocurrency exchanges, announced on Monday that it would suspend new user registrations in the UK from 5 PM local time. This decision comes as a response to the Financial Conduct Authority's (FCA) stringent approach towards cryptocurrency regulation and its newly enforced rules on cryptoasset promotions, which came into effect on October 8.
The FCA's rules allow overseas firms like Binance to market their crypto operations in the UK, provided they engage with an FCA-approved entity. Binance's former partner, Rebuildingsociety.com Ltd, recently faced legal restrictions from the FCA that impeded financial promotion approvals.
The suspension follows high-profile industry collapses last year and is part of a broader effort to navigate the evolving regulatory landscape. Binance is actively seeking a new FCA-authorised firm to approve its financial promotions, demonstrating its commitment to adhering to regulatory norms.
Existing UK users who have passed the Investor Declaration and Appropriateness Test will maintain service access, though new services are on hold during this period. Binance is liaising with the FCA to minimize disruption from high-risk crypto assets and find a suitable firm for financial promotion approval.
The FCA has underscored its commitment to consumer protection by threatening violators with two years imprisonment, an unlimited fine, or both. This move by Binance illustrates the growing pressures faced by cryptocurrency companies in navigating global regulatory frameworks.
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