Crypto Firms Struggles To Meet AML Standards in UK

Crypto Firms Struggles To Meet AML Standards in UK
  • Problems in the process of registering crypto firms.
  • 77 new crypto firms submitted applications that are yet to review.
  • FCA established a “Temporary Registration Regime”.

Crypto firms are struggling to meet the Financial Conduct Authority’s anti-money laundering standards in the United Kingdom.

The FCA had only registered five crypto businesses as of May 24 after becoming the official AML supervisor of the crypto industry in January 2020.

In official comments on Friday, John Glen, a member of the UK Parliament and the Treasury’s economic secretary, figured out significant problems in the process of registering crypto firms under the FCA’s AML regulations.

Moreover, the report says that 90% of the firms evaluated to date have withdrawn their applications. Besides, there are 167 crypto assets with outstanding applications whereas 77 new crypto firms submitted applications  are yet to review.

GLen stated that HM Treasury has been in touch with FCA, regarding concerns on financial services related to cryptocurrency. According to the secretary, significant firms have failed to implement robust AML control frameworks. As a result, the FCA was unable to process the registered application within the deadline,

Additionally, FCA has launched a “Temporary Registration Regime” which allows crypto firms to trade. Trading can continue until a decision is reached on July 9.

Glen states that in January, HM Treasury published a discussion on the broader regulatory framework of crypto, with a focus on stablecoins:

“Furthermore, the future regulatory regime for crypto assets established by the government will try to optimize the potential risk to the public with a desire to enhance industry competition and innovation.”

More so, after dealing with crypto firms, the FCA has increased its regulatory control on the cryptocurrency industry. Besides, the authority plans to demand crypto firms to submit yearly financial crime reports.

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