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British FCA to oversee CTF/AML compliance of crypto firms

British FCA to oversee CTFAML compliance of crypto firms

British FCA will now be responsible for monitoring counter-terrorist funding and anti-money laundering (AML) activities related to companies operating in the crypto realm. Authorities in Britain have announced that the Financial Conduct Authority (FCA) will check whether cryptocurrency firms operating in the United Kingdom adhere to the country’s relevant guidelines on AML or not.

Britain’s crypto regulations are somewhat less clear compared to other crypto-friendly nations. Over the years, it has warmed up to the crypto realm.

What British FCA wants from the crypto businesses

The official announcement further mentions the exact requirements expected from the crypto businesses operating in the country. The British FCA clearly states that cryptocurrency-related firms must comply with appropriate guidelines. These include CFT and AML risk assessment, follow regulatory policies, customer due diligence, proper KYC procedure compliance, and others.

The announcement further mentions that the new British FCA regulations proactively monitor the various risks associated with the crypto industry. It aims to take swift action against the companies that do not meet the standards of the financial industry and may risk market integrity.

Britain’s crypto conundrum is only getting bigger

In July 2018, British FCA issued a warning that virtual currencies present a big risk to the retail consumers due to misinformation surrounding crypto products. It recommended that crypto derivatives pose a significant risk to small traders and investors. Consequently, FCA is considering banning crypto derivative products for individual traders and investors.

British FCA is of the view that most cryptocurrencies are merely a ‘means of exchange,’ and their appeal lies in them being a decentralized and independent ‘exchange tokens.’ Back then, authorities concluded that FCA would not monitor cryptocurrency firms since it is outside its regulatory boundaries. Lately, FCA has taken many steps that have shown crypto in a positive light in the UK. The increased monitoring and sandbox trials have contributed to building a crypto-friendly environment in the country.

Featured Image by Pixabay

Gurpreet Thind

Gurpreet Thind

Gurpreet Thind is pursuing Masters in Electrical Engineering at University of Ottawa. His scholarly interests include IT, computer languages and cryptocurrencies. With a special interest in blockchain powered architectures, he seeks to explore the societal impact of digital currencies as finance of the future. He is passionate about learning new languages, cultures and social media.

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