Two giants of the crypto industry, Binance and Coinbase, recently balanced to align with UK crypto regulations to continue operations in the country.
These changes are pivotal in the crypto industry’s journey as countries struggle to integrate digital assets into their financial systems around the world.
The FCA’s stance on cryptocurrencies
The Financial Conduct Authority (FCA), the UK’s financial regulator, has been outspoken about its concerns regarding cryptocurrency investments. The authority classifies these investments as high risk, taking into account their potential for significant financial losses.
CryptoBusy, a prominent bitcoin analyst, recently shared these sentiments on X (formerly known as Twitter). The publication underlined the FCA’s warnings about the inherent complexities of digital asset investments, highlighting potential obstacles such as the absence of regulatory protections and difficulties in liquidating investments when desired.
Additionally, the FCA suggests that investors act carefully and diversify their portfolios rather than putting all their financial eggs in one basket.
Both #Binance and #Coinbase They are now operating under the new UK crypto rules
“Due to the potential for losses, the Financial Conduct Authority (FCA) considers investing in cryptocurrencies to be high risk.”
What are the key risks?
1. You could lose all the money you invest
2. You should… pic.twitter.com/CJtLVAu2DT– CryptoBusy (@CryptoBusy) October 11, 2023
How Binance and Coinbase are responding
Given these guidelines, Binance and Coinbase have quickly adjusted their offerings for the UK market. In his recent announcement, the former clearly stated that cryptocurrency investments would not benefit from the protection of the Financial Ombudsman Service or the Financial Services Compensation Scheme.
The exchange has taken additional steps to ensure regulatory compliance by limiting certain services to UK Professional Clients. Among these restricted services are spot trading of over 350 cryptocurrencies and the ability to transact non-fungible tokens (NFTs).
Coinbase, on the other hand, echoed similar sentiments by urging UK-based investors to proceed with caution. They advised potential investors not to venture into the crypto space unless they are fully prepared to endure potential losses, emphasizing the high-risk nature of digital asset investments.
In particular, as part of its compliance with the new UK rules, Binance recently launched a dedicated domain for its UK users. According to Binance, the newly established UK domain, www.binance.com/en-GB, ensures that only services that comply with current marketing regulations can be accessed.
UK update https://t.co/7ET9J6KTj4
– CZ Binance (@cz_binance) October 6, 2023
This encompasses services such as fiat and crypto transactions, spot trading, margin trading, Binance payment, and cryptocurrency-backed loans. Conversely, certain Binance offerings will be off-limits to UK backers, including features such as Binance gift cards, academia, research, feeds, and referral bonuses.
Featured image from Unsplash, chart from TradingView
