The Financial Conduct Authority (FCA) has said it is “not capable” of effectively supervising Binance, after the billion-dollar online cryptocurrency broker refused to provide basic details about its operation.
Binance, an online broker specialising in digital currencies, failed to provide the regulator with details about how the business is organised, the legal entity behind its website and how UK customers could use the platform.
The FCA said in a supervisory notice that the firm’s response has been “incomplete and has included direct refusals to provide information”.
Last June, Binance applied to be registered as a crypto business and had further plans to launch a UK-based exchange for retail and business customers.
However, early last month the FCA rejected the application and placed a ban on the firm which prevented it from conducting any regulated activity.
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Binance was also asked to remove live advertising and financial promotions and to place a note on its website and social media which explicitly states that the platform is “not permitted to undertake any regulatory activity in the UK”.
The FCA report added that Binance is a “particular concern” as it offers complex and high-risk financial product which pose a “significant risk” to consumers.
Concerns about Binance sweep the globe
The FCA is not the only regulatory body to express concern about Binance.
Earlier this year, the broker came under fire from Germany’s financial regulator. It warned that the firm could be fined after it launched digital stock tokens – a violation of European Union securities law.
In June, Japan’s Financial Services Agency (FSA) said that Binance was operating in the country illegally.
The US Securities and Exchange Emission is also looking into Binance’s entity, Binance Holdings over concerns surrounding money laundering and tax offences.
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