Financial Conduct Authority warns against 111 unregistered crypto companies

On Wednesday, the Financial Conduct Authority (FCA) has warned UK citizens and consumers against 111 UK-unregistered crypto companies. The British financial authority considers the use of the services offered by these companies as a “very real risk”.

The financial authority’s conservative position

This declaration is in line with the new UK legislation which entered into force on 10th January. It stipulates that every crypto company has to register with the FCA and comply with the Anti-Money Laundering (AML) and Counter-Terrorist Financing (CTF) laws in force.

The FCA is particularly vigilant given the constantly increasing popularity of cryptocurrencies in the UK. According to its data, about 2.3 million adult citizens hold some amount in crypto. However, again, according to the FCA, it appears that few investors really understand the assets they invest into.

Mark Steward, the FCA’s officer in charge of the law, says this interest towards cryptocurrencies is explained by the fear of missing out (FOMO). He believes that “the reason many are investing now is because they have a fear of missing out on what might be a boom.”

The unregulated crypto companies are a threat to consumers, but also to banks and to payment service businesses dealing with them, especially given that few of them are registered with the UK financial authorities.

This is why the British watchdog published the list of unregistered crypto companies comprising 111 firms – it is an effort to ensure the possibility for each investor to check whether the company they are interested in complies (or not) with the local laws in force.

Early 2021, the FCA was appointed the chief supervisor of Anti-Money Laundering and Counter-Terrorist Financing measures.

Starting 10th January 2021, all UK-based crypto-asset firms have to comply with the AML regulations as well as to register with the FCA. However, the global pandemic has resulted in a backlog of applications that are still being processed. Since the beginning of the year, 51 companies have withdrawn their registration applications to the FCA.

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Passionné de la finance et des investissements de demain, je déniche sur le web les dernières tendances (et les dernières infos) en matière de cryptomonnaies et de calcul de risque. De nature curieuse, je fouille et arpente les médias anglophones à la recherche de news à croquer. Mon objectif ? Proposer des informations synthétiques vérifiées et de qualité pour éclairer ceux qui désirent s’aventurer dans le monde des cryptoactifs.

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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