The UK’s Financial Conduct Authority has long been involved with the crypto industry, and yesterday it again warned of misuse of unregistered crypto assets.
The UK’s Financial Conduct Authority has issued a warning about unregistered crypto firms.
The warning aligns with the FCA’s previous statements about the broader crypto industry.
Britain’s financial services regulator, the Financial Conduct Authority (FCA), said yesterday that 111 unregistered crypto-asset firms pose risks to consumers, according to Reuters.
Mark Steward, FCA’s head of enforcement and market surveillance,
We have several companies that do business and stay in touch in the UK without being registered with us: banks, payment service firms, consumers.
Steward spoke at a City and Financial City Week event. He went so far as to say that this craze was the tulip mania, explaining that many of them got into crypto by getting fomo.
FCA’s view on crypto
Steward’s warning about unregistered crypto firms and crypto more generally is in line with the FCA’s stance.
In January of this year, the FCA banned the trading of crypto derivatives, describing the products in question as inappropriate for retail customers. The FCA said that crypto products lack reliable valuations, financial crime and volatility are rampant, and in any case, retail investors lack the understanding to interact securely with such products.
Five days later, the FCA listed its concerns about the crypto industry with consumer protections at the top of the list.
In March, the FCA turned its focus to crypto’s legacy issues with financial crime, announcing that crypto firms will now be required to submit annual financial crime reports to the FCA, just like any other financial services industry.
In summary, the FCA statement includes:
This policy statement recommends that additional firms and crypto-asset businesses be covered for returns based on their business activities and potential money laundering risks.
FCA’s stance may not find support among crypto’s ranks, but its concerns are well established. In May, the UK’s National Crime Agency published its annual assessment of serious and organized crime.
In this report, the NCA said that criminals’ use of technology is increasing and the use of crypto assets for money laundering is increasing in various types of crimes.