FCA Warns FTX For Providing Unauthorized Cryptocurrency Services

The Financial Conduct Authority (FCA), Britain’s main financial regulator, has issued a warning regarding cryptocurrency exchange FTX operating illegally in the United Kingdom.

The Financial Conduct Authority (FCA) of the United Kingdom issued a warning about crypto exchange FTX on its website on Friday. The regulator specified:

“Almost all firms and individuals offering, promoting or selling financial services or products in the U.K. have to be authorized or registered by us… We believe this firm may be providing financial services or products in the U.K. without our authorization.”

The FCA stated that FTX is not permitted but is targeting UK investors. Firms in the United Kingdom engaged in particular crypto asset operations must comply with the modified “Money Laundering, Terrorist Financing, and Transfer of Funds Regulations” and register with the FCA.

“You will not have access to the Financial Ombudsman Service or be protected by the Financial Services Compensation Scheme (FSCS), so you are unlikely to get your money back if things go wrong.”

The warning comes despite the fact that FTX Europe has passporting rights to sell its products to customers throughout the European Union. The European venture is based in Switzerland, with a regional office in Cyprus Securities and Exchange Commission (CySEC).

The UK government intends to tighten regulations on crypto advertising that may be considered deceptive. Rather than developing a new framework expressly for these products, the Exchequer proposes to put the advertising of crypto-assets within the FCA’s existing regulation.

In its first big intervention in the young sector, the City watchdog has already prohibited the trade of derivatives based on cryptocurrency. The restriction forbids individual investors from purchasing derivatives based on Bitcoin values, such as CFDs, options, and futures.

DISCLAIMER: The Information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.

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