Crypto businesses within the United Kingdom are struggling to comply with the new AML [Anti-Money Laundering] standards set by the FCA [Financial Conduct Authority], consistent with a senior official.
John Glen, a member of U.K. parliament as well as the Economic Secretary to the Treasury, acknowledged major difficulties within the process of registering crypto firms under the FCA’s AML regulations within official comments earlier today on Friday.
In line with the official, solely five cryptocurrency businesses have received registration from the FCA as of 24th May after the authority became the official AML supervisor of the crypto industry within the U.K. earlier in January last year.
“Of the firms assessed so far over 90% have withdrawn their application following FCA intervention. There are 167 cryptocurrency asset businesses with outstanding apps,” Glen revealed. He added that 77 new crypto firms have apps pending full assessment.
The secretary mentioned that the FCA was also unable to process and register all applications by its earlier deadline due to a big number of firms failing to adopt robust AML control frameworks as well as employ proper staff. As such, the FCA established a “Temporary Registration Regime” permitting cryptocurrency firms to continue trading pending a choice until 9th July 2021.
Glen also outlined that Her Majesty’s Treasury has been in regular contact with the FCA along with the industry associations, firms, and consumer organizations regarding concerns over the range of monetary services associated with crypto. He added that HM Treasury published a consultation on the broader regulatory framework of crypto with attention on stablecoins in January this year:
“Any future regulatory regime for crypto assets started by the govt in light of this consultation will aim to balance the potential risk to users with the ambition to stimulate competition and innovation within the industry.”
The FCA has been expanding its regulatory oversight of the cryptocurrency industry this year. Earlier in March, the authority announced its plans to require cryptocurrency-related business firms to submit yearly financial crimes reports. Previously, the financial watchdog prohibited United Kingdom firms from offering cryptocurrency derivatives products along with futures and exchange-traded notes to retail users.