FCA Extends Registration Deadline for Crypto Businesses; ‘Significantly High Number’ Not Meeting AML Standards

While issuing yet another warning to investors about crypto assets, FCA said even if a company is registered with them, they are “not responsible for making sure” that those businesses protect client assets.

The Financial Conduct Authority (FCA) says a significant number of cryptocurrency firms are withdrawing their applications to register with the agency because they are struggling to meet anti-money laundering and counter-terrorist financing standards. The U.K. markets regulator said in a statement Thursday,

“A significantly high number of businesses are not meeting the required standards under the Money Laundering Regulations resulting in an unprecedented number of businesses withdrawing their applications.”

As such, the FCA is extending the deadline for its Temporary Registrations Regime for existing crypto-asset businesses to March 31, 2022, from July 9, 2021.

This extension will allow crypto companies to continue to operate while their applications are under “robust assessment.” However, those firms that are not part of the regime or registered with the FCA will be subject to the regulator’s criminal and civil enforcement powers if they continue trading.

Currently, just five companies are registered with the FCA, including crypto exchange Gemini and British start-up Ziglu. Dozens of applications are sitting on the regime list.

In the same statement, the FCA issued yet another warning to investors about the highly speculative nature of crypto assets. Customers should be prepared to lose all their money quickly, the FCA said yet again.

The watchdog has no consumer protection powers for activities of a firm, and even if a company is registered with the FCA, “it is not responsible for making sure crypto-asset businesses protect client assets (i.e., customers' money),” it adds.

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