UK firms distance themselves from Binance amid FCA scrutiny

Binance, the world’s largest cryptocurrency exchange, is encountering resistance in its attempt to re-enter the UK market. This challenge arises from reluctance among potential local partners, particularly due to regulatory concerns.

According to a Bloomberg report, at least three UK firms authorized by the Financial Conduct Authority (FCA) to approve financial promotions for crypto platforms have declined requests from Binance. These firms have the regulatory permission to ensure that communications from crypto platforms comply with FCA rules before being made public.

Binance’s re-entry into the UK market hinges on finding such an authorized approver. However, the exchange’s UK partner, (REBS), was restricted by the FCA from promoting Binance’s products and services in October, leading to a halt in new user onboarding and the search for a new approver.

The FCA has also voiced its concerns about businesses considering partnerships with Binance, adding to the reluctance of firms to engage with the crypto giant. In response to these reports, Binance stated that it continues to have productive conversations with potential approvers and expects to provide a positive update soon.

In May 2023, Binance officially canceled its registration with the FCA through its subsidiary, Binance Markets Limited. This decision followed the exchange’s move to cancel regulatory permissions for activities it had not offered in the UK. Consequently, no Binance entity is currently authorized by the FCA to provide services in the country.

Binance’s challenges in London were compounded by the departure of the UK CEO Jonathan Farnell. His exit came in tandem with heightened regulatory scrutiny that Binance has been facing, not only in the UK but also in the US.

Jonathan Farnell, who had previously worked at eToro heading their compliance department, was a key figure in Binance’s push for regulatory compliance in the UK. He joined the firm in 2021 and soon ascended to a top management position, leading Binance’s efforts to navigate the FCA’s ban on its UK business. In addition to this role, he was also the CEO of Bitfinity, a Binance-affiliated payment platform.