UPDATE 2-Binance can’t be supervised properly, says UK financial watchdog | Financial News – London South East

update-2-binance-can’t-be-supervised-properly,-says-uk-financial-watchdog-|-financial-news-–-london-south-east

(Adds more detail)

By Huw Jones

LONDON, Aug 25 (Reuters) – The world’s biggest crypto

exchange Binance is not capable of being supervised properly and

poses a significant risk to consumers, Britain’s Financial

Conduct Authority (FCA) said in a document published on

Wednesday.

The exchange has come under pressure from regulators across

the world in past weeks due to concerns over the use of crypto

in money laundering and risks to consumers.

The FCA banned Binance in June from conducting any regulated

activity and imposed several requirements on the platform.

Its document published on Wednesday expands on its reasons

for placing the requirements on Binance’s UK-based Binance

Markets Limited arm.

“Based upon the firm’s engagement to date, the FCA considers

that the firm is not capable of being effectively supervised,”

the watchdog said in the document dated June 25.

“This is of particular concern in the context of the firm’s

membership of a global group which offers complex and high-risk

financial products, which pose a significant risk to consumers.”

A Binance spokesperson said that as noted by the FCA,

Binance Markets Limited has fully complied with all the

watchdog’s requirements and it continues to engage with the FCA

to resolve any outstanding issues that may exist.

“As the cryptocurrency ecosystem industry continues to grow

and evolve we are committed to working with regulators and

policymakers to develop policies that protect consumers,

encourage innovation, and move our industry forward,” the

spokesperson said.

The FCA said it sent two requests for information about

Binance’s wider global business model and its stock tokens.

“The FCA considers that the firm’s responses to some

questions amounted to a refusal to supply information,” the

watchdog said in the document.

The exchange, whose holding company is registered in the

Cayman Islands, has scaled back its product offerings and said

it wants to improve relations with regulators.

The FCA said volumes at Binance in June were estimated to be

between $11 billion and $38 billion.

Binance’s UK arm was not currently carrying out regulated

activities and that it had not done so for more than 12 months,

the FCA said in its document.

(Reporting by Huw Jones; editing by David Evans and Emelia

Sithole-Matarise)

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