Major cryptocurrency exchange Binance has been forced to halt withdrawals for UK-based customers following a ban by the Financial Conduct Authority (FCA). The FCA is the UK’s financial watchdog, tasked with the formulation and implementation of financial regulations in the country. It has previously implemented laws requiring cryptocurrency firms to register with the authority if they wish to do business in the country. It also ensures all financial institutions comply with Anti-Money Laundering (AML) and Combating the Financing of Terrorism (CFT) regulations.
Binance is the world’s largest and most popular cryptocurrency exchange, processing over £1 trillion in transactions annually. The exchange has already been banned in the United States and it has faced a variety of criticism from several countries, including Japan and Germany. Some regulators believe the platform is not doing enough to combat financial crimes like money laundering, while others have suggested it features misleading advertising on its website.
While the UK ban means customers cannot withdraw cash from the platform into a UK bank account, it doesn’t completely ban the use of the platform. Customers will still be able to trade cryptocurrencies on the platform with existing funds or send funds to the platform from external sources.
In what appears to be an effort to improve its revenue, Binance recently launched its own NFT Marketplace. NFTs, or non-fungible tokens, have exploded in popularity recently following the sale of multi-million dollar NFT’s by high-profile artists like Beeple.
Binance’s NFT Project Lead Helen Hai told Fortune magazine the company hopes the new offering will “attract millions of potential collectors in the world.” NFTs provide a way for artists to mint and sell their creations independently of third-party galleries and free of commission.
However, only time will tell if the new NFT marketplace can soothe the pain that some Binance customers incurred last month. Following a crash that shaved a billion dollars off the crypto market, investors in Binance’s leveraged tokens discovered their money wasn’t as safe as promised. The platform’s DOWN tokens, which are supposed to profit when markets fall, failed to perform as intended, resulting in large losses for thousands of users.
With customer relations at a low and regulators tightening their grip, Binance will need to work hard to keep afloat as the cryptocurrency market continues to fight for recovery. Despite climbing back from a low below $30k last week, Bitcoin (BTC) still remains far from its April highs above $60k.