- Binance CEO, Changpeng Zhao says the exchange may soon relaunch in the U.K.
- Binance was prohibited from operating in the country back in June.
- Crypto adoption continues to grow in the country despite strict laws.
Cryptocurrency exchange Binance is working on reentering the U.K. market as a regulated entity. The plans were revealed by its CEO, Changpeng Zhao, who disclosed that Binance aims to become a registered crypto-asset firm in the country within the next 6 to 18 months.
He made the statement while speaking to the Sunday Telegraph Newspaper. The disclosure means that the world’s biggest cryptocurrency exchange is putting in place all it needs to be fully compliant with the requirements of the U.K.’s regulatory watchdog, the Financial Conduct Authority (FCA) which barred it from operating in the country back in June.
Binance’s troubles in the UK
At the time, the FCA issued a consumer warning against Binance Markets Ltd., the exchange’s U.K. registered affiliate, stating that the entity was not permitted to “undertake any regulated activities.” It directed that the Binance affiliate as well as every other entity in the global Binance group shut down its operations in the U.K., and not resume without written approval as none of them held any form of UK “authorization, registration, or license.”
In a follow-up of the directive, the FCA noted that Binance had complied with it and shut down its operations.
The UK was not the only country where Binance was running into trouble with regulators at the time. Binance received regulatory scrutiny from the countries including the US, Japan, South Africa, and Singapore, to name a few. In the U.S. the exchange was being probed by the CFTC, the IRS, and the Justice Department for several different reasons.
Binance’s response to the increased regulatory attention was to beef up its regulatory compliance strength. The exchange went on a hiring spree of personnel with backgrounds in regulations. With them announcing plans to relaunch in the UK, the efforts made must be paying off now. The resumption of operations in the country will allow Binance to offer services including futures, derivatives, as well as spot trading according to Zhao.
Crypto adoption continues to grow in the UK
While tight regulations exist that restrict crypto-trading in the UK, and the FCA continues to warn consumers of the risk of trading digital assets, it has not stopped crypto adoption from advancing in the country. According to a recent report, the UK has become the leading country in Europe for cryptocurrency transactions, with $170 billion worth of crypto traded at the end of Q3.
The rapid growth and adoption of crypto have been acknowledged by the country which recently began a tax regime for cryptocurrency exchanges in the country that came into law last year. According to the new tax regime, crypto exchanges will be subject to a 2% digital services tax and would not be able to claim exemptions for being a financial marketplace.
Exchanges in the UK do not consider the law to be favorable and are already calling for a change. The CryptoUK group has stated that it is unfair for the government to hold cryptocurrencies by a different standard from other assets.
The saga may cause exchanges in the country to face more pullback except the laws are loosened up considerably.
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