FCA admits inability to regulate Binance

Thu 26 Aug 2021 ▪ 11h35 ▪ 3 min read — by Hugh Renolds

After a series of attempts to regulate Binance, the world’s largest crypto exchange, the Financial Conduct Authority (FCA) is seemingly admitting defeat, claiming that it currently has no means of controlling the platform due to the lack of communication on Binance’s side. 

Binance has been FCA’s cause for concern for a long time

The authority has tried to reach out to Binance and its branches on multiple occasions, aiming to establish transparency and ensure user safety, all to no avail. Which in turn is a cause for even more concern for FCA, as it asserts that Binance may pose a threat to its users’ financial welfare, being a platform that offers high-risk operations with high-stake financial products. 

The problem, according to FCA, is Binance’s apparent reluctance to establish a two-way interaction and to answer what FCA calls “simple questions.” It further states that throughout 2021, it sent a few information requirements to the platform. Even though Binance responded to the request, the response was tantamount to the refusal to produce any data. 

The FCA also claimed that the exchange had failed to provide any information about trading names and functions of its entities around the world. To make things even more suspicious, it turned out that the UK branch of Binance did not even have an official senior executive. 

Meanwhile, Binance claims that it works separately from the rest of the global group and only takes on people with a proven track record of compliance.

Binance is likely to draw even more attention from regulators worldwide

This is far from the first time Binance has aggravated official authorities. Its obscure management structure and overall vague approach to user safety have raised eyebrows among regulating authorities worldwide, including the USA, Germany, France, and Australia. The list has recently been joined by Hongkong and Lithuania, both alleging that the company’s activity on their respective territories was unlicenced.

The list will go on, as FCA, alongside many other regulators, is unlikely to drop the case and leave it at that. We’ll be seeing more attempts to bring Binance to heel going forward. Till then, stay tuned on CoinTribune.

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Hugh Renolds

I believe in the bright future of crypto. I have been investing since 2017 and look to share my experience in, and thoughts on, crypto and the blockchain.

DISCLAIMER

The views, thoughts, and opinions expressed in this article belong solely to the author, and should not be taken as investment advice. Do your own research before taking any investment decisions.

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