Prominent cryptocurrency exchanges, including Binance and OKX, are actively working to comply with the new financial promotion regulations introduced by the United Kingdom’s Financial Conduct Authority (FCA) on October 8. These regulations, part of the Financial Promotions (FinProm) Regime, aim to ensure transparency, fairness, and integrity in cryptocurrency promotions.
Binance, one of the world’s largest cryptocurrency exchanges, has taken steps to align with the new rules. On October 6th, Binance announced the launch of a dedicated domain for its U.K. users and formed a partnership with the local peer-to-peer lending platform Rebuildingsociety. Starting from October 8, U.K. retail users on Binance will be directed to this localized domain, where only compliant Binance products and services will be accessible.
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These include spot and margin trading, Binance Pay, the nonfungible token (NFT) marketplace, loans, and more. However, in compliance with the FCA’s regulations, certain services such as gift cards, referral bonuses, academy materials, and research will be discontinued. It’s important to note that these changes affect retail users in the U.K. and not users exempted under the new FinProm rules, including certain institutional and professional investors.
OKX, another major cryptocurrency exchange, also addressed FinProm compliance on October 6th. The exchange reduced its token offering to around 40 assets and implemented prominent risk warnings throughout its platform. These warnings emphasize the high-risk nature of cryptocurrency investments, cautioning investors to be prepared for the possibility of losing their entire investment. Furthermore, OKX has established a dedicated U.K. account on social media platform X (formerly Twitter) to communicate the products and services compliant with the new U.K. regulations.
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MoonPay, a crypto payment service provider, is diligently working to adhere to the new FinProm rules as well. Matt Sullivan, Deputy General Counsel at MoonPay, acknowledged the challenges of ensuring compliance, particularly for a global business. He emphasized that compliance requires localized product updates, the implementation of new processes and policies, and comprehensive education across the company. Sullivan also noted that there may be an adjustment period, and interpretations of certain rules may evolve over time.
However, not all cryptocurrency firms have been swift in complying with the U.K.’s new promotion rules. The FCA issued official statements on October 8, indicating that some major crypto exchanges, including KuCoin and HTX (formerly Huobi), may have been promoting their services without the necessary authorization. These firms were among 143 entities listed as “non-authorized firms” prohibited from operating in the United Kingdom, with the FCA advising individuals to avoid dealing with them.
In conclusion, cryptocurrency exchanges and service providers are actively adapting to the new financial promotion regulations introduced by the U.K.’s FCA. These efforts are designed to enhance transparency and protect investors in the rapidly evolving cryptocurrency market, ensuring that promotional activities align with the regulatory framework.
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