Binance will attempt to reverse UK ban amid ongoing global scrutiny
Binance chief Changpeng Zhao has hinted that the company could launch a UK-based subsidiary within 18 months as it looks to bounce back from regulatory clashes with the country’s Financial Conduct Authority (FCA).
As reported by the Sunday Telegraph, the FCA effectively banned Binance from conducting regulated activity in the UK in June, after it failed to answer questions about how the company is run and where its headquarters are based.
But now Zhao says the firm is “fully re-engaged.” It’s applying for an FCA licence in preparation to make another run at the UK market.
“We’re making a number of very substantial changes in organizational structures, product offerings, our internal processes, and the way we work with regulators,” Zhao told the Telegraph.
“We want to continue to establish a presence in the UK and serve UK users in a fully licensed and fully compliant manner.”
To do this, the company has reportedly brought on board more than 200 compliance officers, including a number of ex-FCA employees.
It also needs to demonstrate that it can fully comply with money laundering and terrorist laws.
Read more: [Binance staff exploited users’ crypto trades for personal gain, whistleblower]
Zhao says Binance has also been communicating with the FCA since it issued its notice, describing interactions as “very positive.”
If the company does indeed create a separate UK arm, it would echo the 2019 launch of Binance.US. The company’s US-only offshoot was set up in the face of increasing national regulatory scrutiny.
Binance still fighting fires on all fronts
The regulatory pressure facing Binance has been well documented. Territories including Japan, Malaysia, Thailand, and the EU have joined the UK and US in moving to limit or ban its operations.
Binance.US was created to appease the SEC. It only offers a third of the tokens listed on its parent platform and doesn’t support margin trading.
Then back in May, the crypto exchange found itself the target of both the IRS and Department of Justice (DoJ) when the agencies investigated individuals linked to the exchange over tax and money laundering offenses.
Read more: [Binance won’t get medical records in fight over $10M crypto, says Malta charity]
And in September, the Commodities and Futures Trading Commission (CFTC) opened an investigation into whether Binance staff illegally accessed millions of customer transactions to manipulate crypto markets for profit.
The CFTC started its investigation after receiving a tip from an anonymous whistleblower.
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