What action has the Financial Conduct Authority taken on Binance Markets Limited?
On 30 June 2021 we wrote a blog on how, by way of a Consumer warning on Binance Markets Limited and the Binance Group, the Financial Conduct Authority (“FCA”) has ruled that Binance Markets Limited is not permitted to undertake any regulated activity in the UK without the prior written consent of the FCA. We also noted how the FCA does not specifically regulate crypto-currencies themselves but does require crypto exchanges in the UK to be regulated for anti-money laundering measures.
With regards to regulation, Gherson’s white-collar crime team have recently provided comments to Compliance Week for an article titled “AML compliance proving tall hurdle for U.K crypto firms”. Gherson’s white-collar crime team have also recently discussed issues with the regulations and have previously outlined the difficulties that have been faced in complying with these regulations.
What has Barclays done?
It has been reported that Barclays Bank have subsequently informed customers that they would no longer be able to send credit and debit card payments to Binance following this warning by the FCA. According to Financial News, this was by way of a text message to customers. Binance have responded that “We are disappointed that Barclays appears to have taken unilateral action based on what appears to be an inaccurate understanding of events”.
What does this mean?
Barclays have been clear that the action taken does not impact on the ability for consumers to withdraw funds from Binance. Consumers will just be unable to make payments to Binance using credit and debit cards.
This is not the first time that a bank has blocked customers from transferring money to cryptocurrency exchanges and, in fact, major banking institutions in the UK have imposed restrictions on users from interacting with cryptoasset exchanges citing concerns due to fraud, money laundering and lack of transparency in this sector. This comes at a time when this sector is facing increased regulatory scrutiny at an international level.
If you have had issues with your bank, or have lost access to cryptoassets and/or feel that you have been subject to fraud involving cryptoassets, or, indeed, just want advice in relation to the regulation of this complex area then Gherson’s white-collar crime team can offer expert advice on, the best way to resolve the situation. Do not hesitate to contact us, send us an e-mail, or alternatively, follow us on Twitter, Facebook, or LinkedIn to stay-up-to-date.
The information in this blog is for general information purposes only and does not purport to be comprehensive or to provide legal advice. Whilst every effort is made to ensure the information and law is current as of the date of publication it should be stressed that, due to the passage of time, this does not necessarily reflect the present legal position. Gherson accepts no responsibility for loss which may arise from accessing or reliance on information contained in this blog. For formal advice on the current law please don’t hesitate to contact Gherson. Legal advice is only provided pursuant to a written agreement, identified as such, and signed by the client and by or on behalf of Gherson.
Solicitor in our White Collar Crime Defence Team