Cryptocurrency
exchanges, including Binance and OKX, have embarked on measures to adhere to
the United Kingdom’s new Financial Promotions (FinProm) Regime, implemented by
the Financial Conduct Authority (FCA) on October 8. The regulations aim to
ensure fairness, transparency, and cleanliness in cryptocurrency promotions.
On
October 6, Binance announced its compliance efforts. It has launched a new
domain for U.K. users and collaborated with the local peer-to-peer lending
platform Rebuildingsociety. To align with regulatory requirements, Binance’s
U.K. retail users were redirected to a localized domain from October 8.
The
new domain features only Binance products and services permitted under U.K.
regulations. These include spot and margin trading, Binance Pay, a nonfungible
token (NFT) marketplace, loans, and other services. In adherence to the new FCA
rules, Binance discontinued certain products, including gift cards, referral
bonuses, and academy and research offerings.
These
changes apply exclusively to retail users in the U.K., not affecting users
exempt under the new FinProm rules, such as specific institutional and
professional investors.Similarly,
OKX released a statement regarding FinProm compliance on October 6. The
exchange reduced its token offering to around 40 assets and incorporated
prominent risk warnings on its platform. One such warning, displayed at the top
of OKX’s main page, urges investors to consider the high-risk nature of crypto
investments.
It
reads: “Don’t invest unless you’re prepared to lose all the money you
invest. This is a high-risk investment, and you should not expect to be
protected if something goes wrong.” OKX also introduced a dedicated
U.K. account on the X (formerly Twitter) social media platform, where they
promise to highlight products and services compliant with the new U.K. regulations.
All cryptocurrency exchanges are required to comply with the new financial promotions regime created by the U.K. Financial Conduct Authority (“FCA”).
Accordingly, OKX will be updating its APP and Website to reflect the required changes. One of those changes is that OKX will be…— OKX Help Desk (@OKXHelpDesk) October 9, 2023
Firms
Face Regulatory Scrutiny as Cryptocurrency Regulations Mature
Ensuring
compliance with the FinProm rules presents challenges for cryptocurrency firms
with a global presence. Matt Sullivan, Deputy General Counsel at crypto payment
service MoonPay, acknowledged the complexities, stating that it…
