Binance suspended access to their crypto exchange for users in the UK after the watchdog of the country terminated a partnership to approve communications using its platform according to new local rules.
Binance published a post that stated customers in the UK who had not yet signed up for the platform would no longer be able to access the exchange after 5 pm on Monday in London. Binance’s platform is now out of reach to new users based in the UK.
Starting on October 8, the UK’s financial promotion regime expanded to include all cryptoasset providers, regardless their location. The regulator now requires all crypto platforms to provide clear warnings about risks to UK consumers, and to meet higher standards in terms of technical requirements. All communications must be approved by a FCA-authorized company. The FCA will add you to its public warning list and can also impose unlimited fines or prison time if you do not comply.
Binance had hired peer-to-peer lending platform Rebuildingsociety.com to approve its communications made to UK-based customers, which includes all text on its website and app. The UK’s Financial Conduct Authority restricted Rebuildingsociety.com’s ability to approve communications for crypto companies on Tuesday, ordering it to retract all existing approvals by 5 p.m. in London on Oct. 11.
Binance’s spokesperson told the FCA it was “in active discussion with another FCA-authorized company to approve our financial promotion as soon as we can.” The FCA did not immediately respond to comments.
Binance, and its chief executive Changpeng Zhao, are subject to intense global regulatory scrutiny. The US Department of Justice has been investigating the company for years and is pursuing a series of lawsuits against the company in the US, Canada, and other countries. Financial Conduct Authority warned users against using Binance services in 2021. They also said that the company is “not able” to be regulated effectively due to its murky international structure.
The FCA has already ruled against other crypto firms. Huobi and KuCoin exchanges were among the more than 100 companies that were added on the watchdog’s warning list within the first 24 hour of its launch earlier this month. Consumers saw the generic warning “This firm could be promoting financial products or services without our permission.” You should avoid doing business with this company.”