The UK’s FCA blocks rebuildingsociety.com from approving financial promotions for Binance amid tighter crypto regulations.

The Financial Conduct Authority (FCA), the UK’s financial watchdog, recently took action against rebuildingsociety.com, a peer-to-peer platform. The FCA’s decision? To prevent the company from approving financial promotions of Binance and similar crypto asset firms. Additionally, this comes as a significant development considering Binance, a major cryptocurrency exchange, had only just announced a partnership with rebuildingsociety.com.

Only a couple of days ago, Binance had excitedly declared the launch of its new domain tailored for UK users. As part of their strategic collaboration, rebuildingsociety.com was set to approve Binance’s marketing and promotional content. Furthermore, the intent behind this was to ensure that everything Binance communicated to the UK market was in line with the stringent regulations set by the FCA.

Binance’s Efforts to Comply with FCA’s Standards

Binance, in response to the FCA’s action, highlighted its commitment to adhering to the regulatory framework. Emphasizing their rigorous attempts at compliance, Binance pointed out the vast amount of time and resources they’ve poured into ensuring they meet the FCA’s stipulations. Before the FCA’s updated Financial Promotions Regime took effect on October 8, Binance had already shared its agreement with rebuildingsociety.com on October 2. This was a proactive measure to ensure everything was above board and compliant.

Rebuildingsociety.com, on the other hand, claimed to have done more than what’s required by the FCA to ensure consumer safety. In anticipation of the FCA’s new regulations, they had even sought a waiver. They did this hoping for more time to align their operations fully. However, the FCA rejected this request. Undeterred, rebuildingsociety.com announced plans to appeal against both the FCA’s restrictive decision and the waiver rejection.

FCA’s Stand on Crypto Asset Promotions

The FCA’s stern decision was driven by a clear guideline. Unregistered crypto asset firms should abstain from promoting crypto assets to UK consumers unless an authorized entity approves these promotions. It’s worth noting that the FCA has consistently cautioned investors about the inherent risks associated with crypto investments. FCA even went to the extent of stating that investors should brace for potential total losses.

Under the current regulatory framework, a company that has received authorization from the FCA can endorse the promotions of firms it doesn’t oversee. However, this system may change come February. Post this change, any regulated firm wishing to back the marketing efforts of non-regulated entities will have to seek the FCA’s approval. Moreover, they must prove that they truly grasp the nature of the products being marketed.

Adding to Binance’s woes, the FCA already declared in June 2021 that Binance isn’t allowed to engage in any regulated activities on UK soil. The latest episode only underscores the challenges crypto exchanges face in navigating the complex regulatory landscape of the UK.

The post FCA Halts Binance Promotions in the UK appeared first on Crypto Academy.

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Filed under: Bitcoin - @ October 11, 2023 8:50 pm