Binance’s UK customers can’t make any GBP withdrawals anymore. And 90% of crypto businesses have reportedly withdrawn their applications to register with the FCA under the temporary registration regime.
Here are the comments of Nick Jones, CEO of Zumo, the Edinburgh based crypto wallet on this shocking news for the crypto industry:
“At Zumo, compliance is at the core of our business, and we’re committed to doing everything we can to adhere to compliance standards and protect our users.
“The most recent decision of Binance and several other firms to remove their 5MLD applications shows that the FCA is enforcing robust standards for those crypto businesses that wish to maintain an active trading presence in the UK. Zumo is one of those firms since it is and will maintain its regulation as a payment services provider and a crypto asset service provider.
“Crypto firms have come under increasing scrutiny from the FCA following the ban of crypto derivatives in October 2020 and the launch of the FCA’s temporary registration regime pending final ruling on crypto firms’ applications for FCA approval.
“With 90% of crypto businesses reportedly having withdrawn their applications to register with the FCA under the temporary registration regime, the advantage will be with fully compliant businesses that are able to demonstrate their commitment to being fully compliant with regulations as they evolve.
“Crypto businesses have to accept that regulation is an important step to the crypto business achieving mainstream adoption. From the UK consumer perspective, we believe that means compliant UK-based solutions that can cater specifically to the needs of UK consumers and offer the level of security and consumer protection they have rightly come to expect.
“We’ve seen larger players moving their operations away from the UK to move beyond the FCA’s reach and we can only expect that trend to continue. This would seem to create risks for the UK consumer that there is no way for the regulators to provide a redress for. Presumably this is not planned to be the end state to provide proper customer protection.
“Following the FCA’s consumer warning against Binance, it appears that Binance’s UK users are facing problems making pound (GBP) withdrawals. This emphasises the need for consumers to be aware of the dangers of keeping their cryptos with unregulated exchanges, who might have their access to fiat banking services removed. This is why Zumo has ensured appropriate authorisation and licensing; to ensure it has robust access to GBP payments processing. Binance customers who need to sell their cryptos and receive GBP will probably therefore need to open an account with a crypto firm that offers and off-ramp and has access to GBP banking services. Like Zumo.
We at Zumo will continue to strive to provide compelling and compliant solutions that meet the needs of the everyday UK consumers while providing a transparent and inclusive way to engage with cryptocurrency.”