Binance Suspends New UK Users In Compliance With New Regulations
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The Binance cryptocurrency exchange has said it will stop accepting new users in the United Kingdom. The move seeks to achieve compliance with a new regulatory framework restricting advertisements from overseas digital asset firms operating in the country.
UK customers not already signed up to the Binance platform could no longer join the exchange from 5 PM London time. The move will cut Binance from growing its market share in the UK.
Complying With New Regulations
The UK financial promotions regulatory framework was broadened to commence from October 8 to comprise crypto asset service providers. Crypto platforms must show clear risk warnings to UK-based clients while meeting high technical standards.
The marketing communications a firm needs to do require approval from the financial markets regulator, the Financial Conduct Authority (FCA). The firms that fail to comply with this new regulatory regime face penalties and inclusion to the FCA’s public warning list.
The Binance crypto exchange had appointed Rebuildingsociety.com to approve the communications made to customers based in the UK. However, the FCA failed to approve this appointment, questioning the ability of Rebuildingsociety.com to approve communications for crypto firms.
Following the lack of approval, Binance was forced to retract all the existing approvals by 5pm London time on October 11. Binance has said that it is working closely with the FCA and is looking for another suitable FCA-approved firm to manage its financial promotions.
Binance US Halts Direct USD Withdrawals
Users on the Binance US platform will no longer withdraw dollars directly from the exchange. The exchange updated its terms of use on Monday to show this restriction.
The updated terms of use read, “In the event that customers wish to withdraw US dollar funds from their account, they may do so by converting US dollar funds to stablecoin or other digital assets, which can subsequently be withdrawn.”
Binance US has been making several changes as it faces regulatory scrutiny from US regulators. The US Securities and Exchange Commission filed a lawsuit against Binance US, accusing the exchange of an unregistered securities offering.
Mid this year, Binance US suspended USD deposits on the platform. The exchange attributed the decision to the SEC’s lawsuit, saying that the securities regulator was using “extremely aggressive and intimidating tactics” against the crypto sector. These tactics made banking partners reluctant to interact with the industry.
