The FCA has announced a clamp down on crypto ATMs. In a joint operation with the Metropolitan Police, the FCA inspected several sites in East London suspected of hosting crypto ATMs, which are currently illegal.
Mark Steward, Executive Director of Enforcement and Market Oversight at the FCA, said:
“Crypto ATMs operating without FCA registration are illegal and, as today shows, we will take action to stop this. This operation, alongside last month’s action in Leeds, sends a clear message that we will continue to identify and disrupt unregistered crypto businesses in the UK.”
Crypto ATMs allow people to buy or convert money into cryptoassets. There are currently no crypto ATM operators registered with the FCA, which they must be to operate legally. The FCA regularly warns consumers that there is no protection if things go wrong.
The FCA is currently working with the National Economic Crime Centre to plan and coordinate action with law enforcement partners against operators of illegal crypto ATMs. This follows similar activity in Leeds, where the FCA inspected several sites suspected of hosting unregistered crypto ATMs, alongside West Yorkshire Police.
The FCA is planning to review evidence gathered during these visits and is considering to take further action where necessary.
Katharine Wooller, Business Unit Director at Coincover Thinks the FCA is taking an incouraging step. She feels that the UK’s approach to regulation has been sluggish, so she thinks more proactivity to protect users is a positive step.
“Trust in cryptocurrencies has collapsed once again following the FTX scandal. And if it’s not the collapse of trusted crypto brands, theft, hacking and fraud continue to drive consumer anxieties and scepticism of the entire market. The unfortunate reality is that digital assets remain vulnerable to abuse from a small pool of bad actors, which is why we need to introduce safeguards and proper governance standards.
Without regulation, the market will continue to be a Wild West with abnormally high level of risk. But if implemented correctly, regulation can reduce those risks and protect investors. At the same time, this will also prevent the failures and corruption that create wider market turbulence and ultimately provide cryptos with the trust and security needed for growth.”
The FCA has regularly been in the news, because of its very conservative and extremely strict stance on the approval of crypto businesses. Despite the plans to turn the UK into a bustling crypto hub.
A little less than a year ago Chancellor of the Exchequer, Rishi Sunak said:
”It’s my ambition to make the UK a global hub for cryptoasset technology, and the measures we’ve outlined today will help to ensure firms can invest, innovate and scale up in this country.”
So far the FCA, also called the United Kingdom’s financial watchdog, has given the all-clear to only 41 out of 300 crypto firm applications seeking regulatory approval to date.