U.K.’s financial regulator, the Financial Conduct Authority (FCA), has warned that 111 companies are offering crypto services in the country without proper registration. “This is a very real risk so we are worried about that,” said the regulator’s head of enforcement and market oversight.
111 Unregistered Firms Operating in the UK
Britain’s financial watchdog, the Financial Conduct Authority (FCA), has identified 111 companies operating in the crypto space without necessary registration, Reuters reported Tuesday. The FCA head of enforcement and market oversight, Mark Steward, told City & Financial’s City Week event that these companies are high risk, volatile, and unregulated. He was quoted as saying:
We have a number of firms that are clearly doing business in the UK without being registered with us and they are dealing with someone: banks, payment services firm, consumers. This is a very real risk so we are worried about that.
In the U.K., the FCA oversees the crypto industry, ensuring that companies comply with anti-money laundering and counter-terrorist financing provisions.
Crypto firms are required to obtain full FCA registration before they can begin trading. However, Steward said that only a handful of them have registered.
He then proceeded to warn of the risks of investing in cryptocurrencies, such as bitcoin. The FCA head of enforcement and market oversight opined:
The reason many are investing now is because they have a fear of missing out [FOMO] on what might be a boom. Leaving aside how volatile these instruments actually are, it has tulip mania written all over it.
Earlier this month, Bitcoin.com News reported that the FCA extended the deadline of the Temporary Registrations Regime (TRR) for existing crypto businesses from July 9, 2021, to March 31, 2022. The TRR was established last year to allow existing crypto asset firms that applied for registration before Dec. 16, 2020, and whose applications are still being assessed, to continue trading. The FCA said at the time:
A significantly high number of businesses are not meeting the required standards under the Money Laundering Regulations. This has resulted in an unprecedented number of businesses withdrawing their applications.