The UK’s Financial Conduct Authority (FCA) crypto licensing regime is said to be proving difficult for crypto companies wishing to operate in the country.
According to a Reuters report on Tuesday, the number of license applications withdrawn from crypto companies rose more than 25% in June.
In fact, Cointelegraph reported earlier this month that 51 previously withdrawn crypto companies had applied to register with the FCA. An FCA spokesman quoted by Reuters said 13 more companies had withdrawn from the approval process, bringing the total number of withdrawals to 64.
Since January 2020, the FCA has been overseeing anti-money laundering compliance for the country’s cryptocurrency sector. At that time, the agency established a registration system for crypto companies with an initial term of one year.
However, the FCA was forced to create and expand a temporary registration system amid a backlog of license applications.
By exiting the licensing process, these companies will have to stop all crypto-related activities or risk taking fines and legal action from the FCA. However, some companies not covered by the agency’s AML mandate may still provide services.
In early June, the FCA notified UK consumers about 111 unregistered crypto companies in the country.
Connected: 51 crypto firms withdraw British license applications
The series of withdrawn filings comes amid heightened regulatory scrutiny of crypto exchanges in multiple jurisdictions. The FCA itself has taken action against several major platforms, including Binance.
In addition to the UK, regulators in Japan and Ontario, Canada have issued warning notices to Binance. The crypto exchange giant reportedly withdrew its license application in the UK in May.
For Yoni Assia, CEO of the trading platform eToro, industry participants should expect even more regulatory measures from government authorities. However, the eToro boss advises regulators to expand their knowledge of the crypto space and develop nuanced guidelines.
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