Binance has run into trouble with the UK government, just days after establishing a collaboration to adhere to financial promotion rules. Rebuilding Society, Binance’s UK partner for financial promotions’ compliance, is subject to regulations from the Financial Conduct Authority (FCA), the UK’s financial regulator.
Since the FCA got involved, the Rebuilding Society can only approve promotional materials for licensed crypto-asset service providers. The FCA is taking this step as part of its ongoing efforts to increase regulation and compliance within the dynamic cryptocurrency market.
The FCA has ordered the Rebuilding Society to immediately revoke any permissions it has given in the past to unapproved parties for financial advertising. Additionally, the lender must inform its customers who use its third-party financial promotions service that it cannot approve content from unauthorised sources and must remove any advertisements offering its services for supporting financial promotions.
One exciting aspect of the FCA’s regulations is their timeliness. Binance has just partnered with Rebuilding Society for financial promotion regulation in the UK. Binance, in a recent blog post, emphasized the importance of Rebuilding Society’s permission and regulatory approval from the Financial Conduct Authority (FCA) as part of the company’s strategy for complying with the FCA’s new financial marketing environment.
On October 8, 2023, the Financial Conduct Authority (FCA) implemented its new rule regulating financial advertising relating to crypto assets. Cryptocurrency advertising on websites, social media, and other digital channels must adhere to these guidelines. The regulator has clarified that unregistered crypto asset enterprises that do not comply with these rules will face criminal prosecution under section 21 of the UK’s Financial Services and Markets Act 2000.
It’s important to remember that Archax backs Coinbase and OKX in their communications within the UK because Archax can allow marketing on behalf of other crypto companies. Due to this regulation change, UK consumers can no longer access services like news feeds on sites like Binance’s global website and Coinbase’s app.
The FCA’s limitations on Binance’s UK compliance partner are a sobering reminder of the increasing regulatory scrutiny being applied to the cryptocurrency industry and the importance of maintaining tight adherence to ever-changing compliance standards. Market participants must negotiate a complex regulatory landscape to guarantee their operations are compliant as the Bitcoin ecosystem continues to change.
