On Thursday, the Financial Conduct Authority (FCA), which is the regulatory authority in the United Kingdom, said that they needed to develop global crypto rules for overseeing companies in the industry, such as Binance. Crypto companies in most parts of the world are operating without any such regulation, but many countries do have laws requiring them to comply with anti-money laundering (AML) rules and policies.
According to the FCA, they had not permitted the largest crypto exchange in the world in terms of trading volume, Binance, to operate in Britain. The exchange had not been allowed to conduct any regulated activity because it was not possible to supervise it effectively.
However, it should be noted that regulatory authorities in Italy, Spain, and France have permitted Binance to conduct its operations in their respective jurisdictions. Nikhil Rathi, the chief executive of the FCA, said that it is apparent that they need to have some global baseline standards for the crypto industry.
Washington’s Peterson Institute for International Economics had questioned him about whether crypto companies were playing off regulatory authorities against one another.
The FCA’s stance
Rathi stated that just as in some other sectors, such as anti-money laundering (AML), there are some very well-organized actors that engage in these cross-border activities. Therefore, he said that it was a must to have some strong and common regulatory standards everywhere and cross-border information sharing should also be ensured in order to keep the markets clean and safe.
The UK watchdog had received scores of applications for registration from crypto companies that were turned down and the authority has had to deal with a lot of backlashes because of it. Rathi stated that where cryptocurrencies are concerned, the watchdog will always take a hawkish approach where consumer protection is concerned.
It should also be noted that the FCA has also issued warnings before about the crypto space and told investors that they can lose all of their money in crypto investments. According to Rathi, their warnings had materialized recently after the crash of Bitcoin that happened in the last couple of months.
A global regulatory authority, the Financial Stability Board (FSB) announced this week that they would make some draft recommendations for regulation of the crypto market to G20 countries. It said that these recommendations would be made by October this year.
Last month, a member of the French parliament also urged the market regulator in France to review their decision of giving approval to Binance. It should be noted that the crypto exchange has seen some opposition in other countries in terms of regulation and has come under fire for its services.
Nonetheless, it is a fact that crypto regulation is becoming a hot topic globally, especially after the recent turmoil in the market resulted in losses all across the board. The crash of the UST stablecoin and the LUNA token has also driven regulatory authorities to step up their efforts of regulating the market.