The UK’s financial regulator has warned consumers against dealing with FTX, the cryptocurrency exchange run by billionaire Sam Bankman-Fried, in the latest clash between British authorities and foreign digital asset companies.
The Financial Conduct Authority said the Bahamas-based exchange appeared to be offering products and services in the UK without its permission, according to a statement on the regulator’s website. .
“This company is not authorized by us and is targeting people in the UK,” the statement said. FTX did not immediately respond to a request for comment.
The move against FTX, one of the largest digital asset exchanges, comes after a bitter battle between the FCA and Binance as the UK ramps up efforts to control the often unregulated world of electronic money.
The FCA intervened against Binance last year, saying that its “high-risk and complex financial products” pose “significant risk to consumers” and that the largest cryptocurrency exchange world has “failed to respond” to some of its basic queries, making it impossible to monitor crowded groups.
Binance, one of FTX’s main competitors, has committed to full regulatory compliance and re-registered to be regulated in the UK.
Cryptocurrency exchange and wallet providers must register with the FCA for anti-money laundering oversight if their digital asset operations are “conducted in the UK business manner”, according to a guideline. of the FCA.
FCA and other financial regulators worldwide have faced the challenge of trying to protect consumers and impose standards in the cryptocurrency market, where many of the largest groups are based in foreign jurisdictions. Both FTX and Cayman Island-registered Binance have set up US branches to appease US authorities but provide services in other countries from their international bases.
FTX’s European division this month announced that Cyprus’ financial regulator had granted it an investment company license, as the crypto firm ramps up expansion across the continent. Bankman-Fried, chief executive of FTX, said at the time: “Securing this license in the European Union is an important step towards achieving our goal of becoming one of the exchanges. The most regulated exchange in the world.”
The FCA said UK customers dealing with FTX will not have access to UK consumer protections such as the Financial Ombudsman or the Financial Services Compensation Scheme and will ” inability to receive [their] refund if something goes wrong”.
