- The NAO asserts that the lack of dedicated crypto staff is to blame.
- The FCA took longer than anticipated to register crypto-asset enterprises as per NAO.
The United Kingdom’s National Audit Office (NAO) has voiced doubts over the FCA’s ability to effectively oversee the cryptocurrency market.
According to the NAO’s latest report, “Financial services regulation: adapting to change,” the FCA is allegedly dragging its feet when it comes to responding to and prosecuting illegal activity inside the cryptocurrency sector.
Lack of Dedicated Crypto Staff
According to the NAO, the FCA waited almost three years before taking action against the illicit operators of cryptocurrency ATMs. According to reports from July, 26 cryptocurrency ATMs were taken down in the UK by the FCA as part of a coordinated probe.
However, according to the NAO:
“While the FCA has required crypto-asset firms to comply with anti-money laundering regulations since January 2020, and began supervision work including engaging with unregistered firms, it did not begin taking enforcement action against illegal operators of crypto ATMs until February 2023.”
The NAO asserts that the lack of dedicated crypto staff is to blame for the FCA’s sluggish processing of crypto business registration requests. The analysis states that in order to comply with money laundering requirements, the FCA took longer than anticipated to register crypto-asset enterprises due to a lack of crypto expertise.
According to reports from January 2020, out of 300 applications from crypto firms seeking regulatory permission since the laws were established, only 41 were authorized by the FCA. This follows the FCA’s recent publication of advisory materials meant to assist crypto companies in comprehending the newly-enacted crypto marketing regulations.
The FCA reportedly issued “finalized non-handbook guidance” last month to help businesses comply with the new regulations. How cryptocurrency companies may advertise to consumers was the subject of the new rules.
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