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From today, the UK’s Financial Conduct Authority (FCA) will oversee companies doing business with crypto assets. The change is part of previous amendments to the nation’s anti-money laundering (AML) and counter-terrorist financing regulations.
The news comes via a post from the Financial Conduct Authority (FCA) website. It states that companies engaging in specific activities relating to cryptocurrencies will need to comply with new requirements.
Amongst others, the requirements include:
Both new and existing companies will need to comply with the amended regulations. The FCA post states that new companies will need to register with the agency immediately. Meanwhile, existing firms falling under FCA remit, including “e-money institutions or payment services businesses” with interests in crypto assets, will have until January 2021 to get registered. To ensure that they meet this deadline, the FCA states that companies impacted must submit registration applications by June 2020.
A previous document, published by the FCA in October last year, defines the scope of the amended regulations. It states that the regulatory changes will bring the UK’s policy in line with the EU’s Fifth Anti-Money Laundering Directive (5AMLD), which came into force today. The regulations will also incorporate recommendations made by the Financial Action Task Force (FATF).
The prior post by the FCA states that the amended regulations will impact digital currency exchange providers (both fiat to crypto and crypto to crypto platforms), Unlike the physical wallet in your back pocket, a cryptocurrency wallet doesn’t actually store currency but the keys to a... More providers.ATM operators, peer-to-peer marketplace providers, those issuing new crypto assets, and custodian
As well as influencing the change in UK policy, 5AMLD is already shaking up the European cryptocurrency industry.
As BeInCrypto reported at the end of last year, multiple companies have already stated that they will no longer be able to offer the same service they did before the regulatory change. The likes of BottlePay, Simplecoin, and Chopcoin are all amongst those impacted.
The Netherlands-based cryptocurrency derivatives exchange Deribit has also announced changes based on the new European regulations. Rather than compromise the service it delivers to customers, it has instead relocated to Panama. Industry analysts expect more companies to follow suit, too.
Not all companies are planning to shut down or move their base of operations. As BeInCrypto reported early last year, popular peer-to-peer Bitcoin marketplace LocalBitcoins has already implemented new, tighter KYC checks in accordance with the new European regulations. It remains to be seen which companies will move, which will comply, and which will simply die as a result of 5AMLD and the specific national regulations it creates.
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