UK Financial Watchdog Reminds Crypto Businesses to Register Ahead of Deadline

The United Kingdom's Financial Conduct Authority, or FCA, on Monday urged all national cryptocurrency businesses to submit their registration with the regulatory watchdog.

According to the FCA’s statement, firms must submit completed applications by June 30. The regulator says that the anticipated deadline is necessary to ensure that all applications are processed by the end of the grace period on Jan. 10,  2021.

As Cointelegraph reported at the time, this follows the FCA’s appointment as a direct regulator of U.K. cryptocurrency businesses, announced on Jan. 10, 2020.

The regulator set forth compliance requirements for certain types of crypto-related activity, which involve full assessment of risk in terms of Anti-Money Laundering (AML) and Counter-Terrorism Financing regulations (CTF). 

Companies doing business in the United Kingdom will need to establish both monitoring and control systems to eliminate potential AML and CTF threats. Failure to comply by the 2021 deadline means that they will need to cease their activity in the country.

The June 30 deadline “allows the FCA to review submitted applications and raise any follow-up questions with firms,” the statement reads.

Furthermore, traditional fintech companies dealing with crypto assets that are already authorized under the Financial Services and Markets Act 2000, Electronic Money Regulations 2011 or Payment Services Regulations 2017, will also need to submit their application for the enhanced regulatory monitoring.

The watchdog warned that it “will proactively supervise firms’ compliance with the new regulations, and will take swift action where firms fall short of desired standards.”

Wave of regulatory tightening

As Cointelegraph reported previously, the recent actions by the FCA are part of an effort to bring the U.K regulatory environment on par with the global standards defined by FATF, and the 5AMLD EU regulation, in force since 2020.

The regulator’s efforts have a clear objective of cutting down on potential money laundering and terrorism financing pathways enabled by crypto’s anonymity, as experts told Cointelegraph earlier.

In July 2019, the FCA pledged that it would not regulate Bitcoin (BTC) and Ether (ETH), focusing instead on the infrastructure around them, as well as other tokens that could constitute securities.

The FCA had also set its sights earlier on some types of crypto derivatives, specifically contracts for difference and exchange-traded notes. 

While the regulator appears to have ultimately refrained from definitive crypto bans, it appears to have instead shifted its strategy to tight regulatory controls.