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Cryptocurrency exchange Binance banned from operating in the U.K. by FCA

Cryptocurrency exchange Binance has been banned from operating in the U.K. by the Financial Conduct Authority, in the latest sign of a growing crackdown on the crypto market around the world.

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Cryptocurrency exchange Binance has been banned from operating in the U.K. by the Financial Conduct Authority, in the latest sign of a growing crackdown on the crypto market around the world.

The FCA said  that Binance Markets Limited, the U.K. division of Binance, “is not permitted to undertake any regulated activity in the U.K.

Fintech lawyer, Nigel Brahams, provides comment:

This is nothing new in terms of interpretation. However, this demonstrates a more interventionist approach on the part of the FCA. The FCA has already explained that regular cryptocurrencies (i.e. BTC, ETH etc) remain unregulated and that financial products based on cryptocurrencies i.e. futures, CFDs, baskets (loosely categorised as “crypto derivatives”) fall within the scope of regulation. As a result exchanges and brokerages offering access to crypto derivatives must themselves be regulated.

At present, there is no shortage of platforms offering access to both cryptocurrencies and crypto derivatives. However, many of these platforms are unregulated and indeed operate from overseas. Binance is the largest global exchange, operating out of Cayman but available globally including to UK customers.

The FCA has imposed a ban, not on Binance’s core market but on its UK regulated subsidiary, Binance Markets Limited. The FCA recently banned the sale of crypto derivatives to retail customers on the grounds that they are too high risk. However, this action against Binance takes things much further and demonstrates a much more interventionist, some might say protectionist attitude on the FCA’s part.

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