TL;DR Breakdown
- The UK`s financial watchdog shuts down 81 Bitcoin cashpoints and terms them illegal.
- FCA warns convenience stores and supermarkets hosting crypto ATMs of imminent closure.
The UK’s financial regulator has sent a letter to 81 cryptocurrency ATM providers demanding a shutdown. The Financial Conduct Authority issued the command and raised the prospect of action if it was not followed. Most significantly, the UK’s Financial Conduct Authority declared them illegal.
UK government tightens grip on crypto regulations
The majority of Britain’s cryptocurrency ATMs are in convenience stores and supermarkets. The ATMs enable customers to exchange cash for Bitcoin. They do, however, have minimal security procedures, especially for smaller amounts, and none of them are regulated.
Because they are unlicensed, their presence has exacerbated concerns about security in the Kingdom. Government organizations are concerned that these ATMs might be used to launder money, prompting the FCA to act.
The approach of the regulatory body is in line with its well-known uncompromising regulatory attitude to crypto. In January 2022, the UK’s financial regulator prohibited Binance Markets from conducting unregulated activities in the United Kingdom.
The decision was the country’s regulator most significant to date, coming amid a worldwide crackdown on cryptocurrency businesses. According to the Financial Conduct Authority’s register, Binance Markets has until late June 30 to confirm that it has deleted all advertising and financial inducements.
Additionally, the exchange must also make clear on its website, social media platforms, and all other communications that it is no longer allowed to operate in the United Kingdom.
Crypto ATMs under fire
The UK’s crypto-asset market is relatively immature, with only 33 firms listed on the country’s official list and another 22 on a time-limited waiting list that ends in March. According to Coin ATM Radar data, 81 functioning cryptocurrency ATMs are currently in the United Kingdom. Additionally, supermarkets and convenience stores that have installed ATMs have received warnings that could result in closure.
The Financial Conduct Authority (FCA) has banned 110 firms thus far, one of which, Gidiplus, lost its appeal in court. According to the announcement, the UK’s Upper Tribunal ruled against the appeal submitted by the cryptocurrency ATM operator. The FCA pointed to a lack of evidence regarding how Gidiplus would carry out its business in a generally compliant manner.
Meanwhile, the operator’s appeal against FCA for denying its registration application under the MLRs is still pending in court. The financial watchdog published the notice on its website on Friday, March 11, stating that:
“Crypto ATMs offering cryptoasset exchange services in the UK must be registered with us and comply with UK Money Laundering Regulations (MLR). None of the cryptoasset firms registered with us have been approved to offer crypto ATM services, meaning that any of them operating in the UK are doing so illegally and consumers should not be using them.”
The United Kingdom is not the first country to establish legislation for crypto ATMs. The ban in the UK follows closely after similar advertising limitations imposed by Spain and Singapore. In January 2022, MAS compelled Singapore’s significant operators of crypto ATMs to cease their cash machines owing to regulatory restrictions.
After the Monetary Authority of Singapore (MAS) outlawed cash-to-crypto ATMs, they began a broader crackdown on advertising cryptocurrency to the public.
