FTX CEO Issues Scam Warning After UK Finance Regulator Suggests the Exchange is Operating Unlawfully

20 September 2022, 06:57 GMT+0000
Updated by Kyle Baird
20 September 2022, 06:57 GMT+0000
In Brief
  • Sam Bankman-Fried, CEO & Founder of FTX took to Twitter to warn the FCA about employee impersonators.
  • The UK's FCA recently informed customers that it suspected FTX was operating without proper authorization.
  • The news follows the recent license that the platform received from the Cyprus SEC for its EU platform.
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Soon after the financial regulator of the United Kingdom issued a warning to consumers against the FTX cryptocurrency exchange, Sam Bankman-Fried, CEO & founder of the platform, took to Twitter to warn them about a scammer instead.

The CEO warned that “a scammer has been impersonating FTX in the UK by phone.”

A day prior, in a statement posted to its website, the Financial Conduct Authority informed customers that it suspected FTX was operating without proper authorization in the country.

“Almost all firms and individuals offering, promoting, or selling financial services or products in the UK have to be authorized or registered by us,” the regulator said. “This firm is not authorized by us and is targeting people in the UK.”

The development also comes at a time when FTX was pushing expansion in Europe.

FTX Obtains CySEC license

Recently, the Cyprus Securities and Exchange Commission (CySEC) permitted FTX Europe to conduct business as a Cyprus investment firm (CIF), enabling it to own the local company it previously bought.

The statement noted that FTX EU was permitted to serve the entire European Economic Area with the Cyprus Investment Firm License. As the only cryptocurrency exchange in the world with a full MiFID II license, held to significantly higher requirements than regional registrations as Crypto Asset Service Providers, FTX was set to offer an entire range of exchange services.

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Sam Bankman-Fried said, “Securing this license in the European Union is an important step in achieving our goal of becoming one of the most regulated exchanges in the world.”

“We are continuing to work with CySEC and regulators across the globe to be the leader in the digital asset industry when it comes to meeting the financial standards that are expected of traditional financial institutions,” he added.

Europe has become a crucial playing field

Competitors of FTX like Coinbase, Gemini, Crypto.com, and Binance have announced permits in several European nations in recent months. For instance, countries including Spain, France, and Italy recently approved Binance’s business operations. However, tighter rules under the Markets in Crypto-Assets (MiCA) framework can pose challenges to these exchanges’ expansion plans.

The registrations are a crucial step in advance of broad regulations under MiCA, even if they do not imply that the exchanges have been granted a license to operate as regulated financial institutions in these nations.

Disclaimer

BeInCrypto has reached out to company or individual involved in the story to get an official statement about the recent developments, but it has yet to hear back.