FCA reinforces its strong stance on cryptocurrencies to combat money laundering
The stringent registration process for crypto businesses implemented by the Financial Conduct Authority (FCA) in the U.K. is being defended by the organization, despite concerns that it may stifle innovation in the industry.
In a recent blog post, Val Smith, the head of payments and digital assets at the FCA, reiterated the agency’s commitment to maintaining high standards during the registration process. Smith emphasized that the FCA’s experts carefully evaluate each application and do not reject them without proper consideration.
Smith also addressed concerns regarding potential illicit activities, such as terrorism, organized crime, and human trafficking. She warned against relaxing the standards, as it could lead to a decline in regulatory practices, creating a “race to the bottom.”
When evaluating firms, the FCA scrutinizes their internal controls, overall operations, and the individuals responsible for managing them. This comprehensive evaluation process ensures that only legitimate and trustworthy businesses are granted registration.
Smith’s defense of the FCA’s regulatory framework comes in the wake of the agency’s annual report, which revealed that out of the 35 crypto applications received in the previous year, only four were approved. This statistic highlights the significant challenges faced by new players attempting to enter the U.K. crypto market.
To address rule-breaking within the crypto industry, the FCA has taken action against non-compliant firms, demonstrating its commitment to maintaining a robust and secure environment for crypto businesses in the U.K.
