The Financial Conduct Authority (FCA) extended the temporary registration regime for cryptoasset businesses until 31 March 2022.
“A significant number of firms do not comply with anti-money laundering requirements. This has led to an unprecedented number of companies withdrawing their applications to register with the regulator. The extension of the regime will allow them to continue operating while the FCA conducts a thorough assessment,” the regulator said.
The regulator stressed that adherence to AML standards is not the only, but a mandatory requirement for registration.
The statement noted that the FCA does not have authority to protect investors in relation to firms operating in the crypto industry. Even if a firm is registered with the regulator, the latter bears no responsibility for safeguarding clients’ funds.
“Digital assets are extremely high-risk and speculative investments. If consumers invest in cryptoassets, they should be prepared to lose all their money,” the regulator added.
The FCA introduced temporary registration regime for cryptoasset businesses awaiting approval in December 2020. It was expected to last until 9 July 2021.
At present, five companies are listed in the regulator’s register. Applications from more than 160 organisations are under review.
In May 2021, the FCA granted permission for the Digivault digital asset custodian, part of the Diginex group, to operate in the United Kingdom.
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