Binance banned from operating in the UK by FCA
Binance, the world's biggest crypto-currency exchange, has been banned by the UK's financial regulator, the Financial Conduct Authority (FCA). The company was told by the FCA to stop 'any regulated activity' in the UK.
The FCA also issued a consumer warning about Binance.com, advising people to be wary of adverts online and on social media promising high returns on investments in cryptoasset or cryptoasset-related products.
Binance said the FCA notice would have no "direct impact" on the services it provides from its website Binance.com.
The FCA has required all firms offering cryptocurrency-related services to register since January and show they comply with anti-money laundering rules. Binance has not registered with the FCA and therefore is not allowed to operate an exchange in the UK.
“Due to the imposition of requirements by the FCA, Binance Markets Limited is not currently permitted to undertake any regulated activities without the prior written consent of the FCA.
“No other entity in the Binance Group holds any form of UK authorisation, registration or licence to conduct regulated activity in the UK,” The FCA said.
Scrutiny of Binance
Binance has already had issues in other countries. In Germany, this past April, financial regulators warned Binance that it would incur fines for offering digital tokens that track publicly traded companies like Microsoft and Apple. Binance was selling these tokens without publishing an investor prospectus, as required by law—a violation that could invite a penalty of 5 million euros ($6 million).
Last month, Bloomberg reported that US officials who probe money laundering and tax offences had sought information from individuals with insight into Binance's business.
Most recently, Binance announced it was pulling out of Ontario, Canada, after the Ontario Securities Commission (OSC) accused it and several other crypto trading platforms of failing to comply with province regulations. This past week also, Japan's Financial Services Agency (FSA) warned Binance for the second time in three years that it is operating in the country without permission.
Regulators globally are taking a greater interest in cryptocurrencies and products linked to them. They are cracking down on cryptoassets amid fears they contribute to fraud and money laundering, and are also concerned that investors are at risk of big losses.
State Street launch crypto service for private funds clients
State Street Corporation is now expanding its push into the cryptocurrency industry by launching new digital asset services. It will provide digital and cryptocurrency asset fund administration capabilities for the firm’s private funds clients.
In partnership with Lukka, a leading enterprise crypto asset data, and software provider, State Street will support its private fund clients with collection, standardisation, enrichment, reconciliation, processing, and reporting related to crypto and other digital assets.
The partnership is State Street’s latest effort in the digital and crypto-asset space following the launch of State Street Digital, a division focused on addressing the industry’s evolving shift to digital finance, and comes after Lukka’s Series C funding round in December of 2020, which was led by State Street.
A rise in digital assets
“The growth in popularity of digital assets is showing no signs of a slowdown and State Street Digital is committed to continuing to build out the necessary infrastructure to further develop our digital assets servicing models to help meet our clients’ growing demands,” said Nadine Chakar, head of State Street Digital. “Our work with Lukka will leverage their software and data in order to help expand our digital and crypto asset fund administration capabilities to alternative managers is just another advancement in our digital solution set and marks a very exciting development.”
State Street will leverage Lukka’s product suite, which includes a proprietary middle and back-office data management solution, purpose-built for blockchain and crypto-asset data, as well as Lukka Reference Data, and Lukka Prime Pricing Data. This will enable State Street to consume crypto assets that are comingled within a private client’s traditional alternative investments portfolios.
“As our clients continue to adopt digital assets, such as crypto, we’ve seen increasing interest among investors for institutional quality middle and back-office offerings that support diversified portfolios,” said Jen Tribush, alternatives lead for State Street Digital.“ Lukka was the ideal partner to help provide these services given their leading position in crypto asset data as State Street continues to add to our growing offering in the digital asset space.”