Centralized exchange CEX.IO has officially resumed operations in its UK market today, having now met compliance requirements from the country’s financial regulator, the Financial Conduct Authority (FCA). The FCA’s new law regulating British exchanges will take effect on October 8, 2023, and since then CEX.IO has voluntarily withdrawn from the British market.
CEX.IO returns to the UK market in partnership with Gateway 21
The UK is one of CEX.IO's main markets, with UK users accounting for approximately 69% of its total customers across Europe before the suspension of services, and trading volume increased by 26.9% month-on-month. The cryptocurrency exchange claims to have more than 15 million users worldwide and is understood to have 190 digital assets currently available in the UK.
CEX.IO is also applying to the FCA for the AML registration process. However, it has been able to return to the UK market through a partnership with Gateway 21, an FCA authorized and regulated financial promotion approval body, and all CEX.IO services are currently provided in Lithuania. Cryptocurrency service providers are increasingly using such providers to ensure compliance in the UK, with cryptocurrency lender Nexo also partnering with Gateway 21 and last week announcing the resumption of UK customer registrations.
Binance also once entered the market through partners in the UK, but it still encountered setbacks after the UK tightened regulation:
Exchange’s Road to Compliance in the UK｜Binance cooperates with local companies, HTX and KuCoin are listed on the warning list
Binance UK expansion changes, unable to accept new users, no advertising
The UK has strict regulations and international exchanges are not allowed to enter.
It is understood that changes that cryptocurrency companies in the country will need to make compared to before the new regulations were introduced include a cooling-off period and risk warnings for British customers. Users are also required to complete an investor classification questionnaire and suitability assessment, which has become standard practice for cryptocurrency service providers in the UK market.
After the new regulations came online, regulators issued 450 alerts for illegal cryptocurrency promotions in just one year. and warned that even cryptocurrency-related memes posted on social media could violate the rules. Cryptocurrency exchanges such as Coinbase and Binance have even removed news feeds for UK residents to avoid falling foul of the new regulations.
The regulator said at the time that unregistered crypto asset companies could breach Section 21 of the UK’s Financial Services and Markets Act 2000 if they did not comply with new financial promotions guidelines. Imprisonment, an unlimited fine, or both. Although the new law has good intentions and aims to create a more transparent currency market. But several companies, including payments giant PayPal and fintech app Revolut, found the new laws challenging, while cryptocurrency exchange Bybit pulled out of the UK market entirely. Meanwhile, other companies such as Coinbase, OKX and Binance have also turned to third parties for compliance.
(Aiming at crypto KOLs! The British regulatory agency FCA warned meme promotion images and texts for the second time: violations are punishable by 2 years in prison)
This article CEX.IO returns to the UK market and becomes the first compliant exchange under the new regulatory law through a third-party route. First appeared on Chain News ABMedia.
