The chief financial regulatory body of the United Kingdom revealed a majority of the crypto companies operating in the country have failed to comply with the latest set of anti-money laundering regulations issued by the government. The new regulatory policy set by the Financial Conduct Authority (FCA) would only offer operating licenses to those crypto firms that comply with the latest AML and terror financing guidelines that came into effect from January this year.
“The FCA will only register firms where it is confident that processes are in place to identify and prevent this activity,”
The majority of the crypto firms have failed to adhere to new AML compliance and as a result, a significant portion of these companies have withdrawn their application. The last date for filing with the FCA was set for July 9, however, looking at the growing number of crypto companies withdrawing their filings the regulatory body has extended the registration period to March 22.
Governments Around the Globe Introducing Stricter Regulation
A majority of governments around the globe want to bring crypto companies under new AML guidelines and terror financing compliance, claiming the use of digital assets has increased for illicit activities. There is little evidence to back the claims and most recent evidence indicates less than 1% of crypto assets have been used for carrying out illegal activities.
Apart from the UK, even the Biden administration has indicated possible strict regulations around the cryptocurrency market. The new US Securities and Exchange Commission (SEC) head Gary Gensler has stressed the same in the majority of his testimonials and public addresses since taking office a few months back.
While regulations shouldn’t be seen as a regressive step, the strict policies of the government often steer away booming companies to locate elsewhere as seen during the post-2017 bull market when many established crypto firms had to move out of New York due to strict licensing rules.