U.K Binance users are reporting the suspension of fiat withdrawals and deposits on the crypto exchange. Additionally, attempts to on/off ramp show the service is suspended for maintenance.
This comes as a Financial Conduct Authority (FCA) published an article on the weekend warning consumers about Binance Markets Limited and the Binance Group.
Given the close succession of the two events, social media is awash with talk that the suspension is more than just a temporary maintenance issue.
Neither Binance nor its payment processor partners have commented on the matter, fueling speculation of a crypto crackdown.
The FCA Sound The Alarm On Binance
The FCA posted an article on Saturday stating that Binance Markets Limited is not authorized to conduct business in the U.K. It also warned that no other Binance Group entities have the green light to conduct regulated activities in the U.K either.
It also mentioned that crypto derivatives, which they consider securities, can only be advertised and sold by firms authorized by the FCA.
“While we don’t regulate cryptoassets like Bitcoin or Ether, we do regulate certain cryptoasset derivatives (such as futures contracts, contracts for difference and options), as well as those cryptoassets we would consider ‘securities’”
Given that the article contained no new information, many took this to mean its business as usual.
In response, Binance posted a tweet saying the FCA notice has no impact on its services.
“The FCA UK notice has no direct impact on the services provided on Binance.com. Our relationship with our users has not changed.”
However, as news broke of the suspension of fiat withdrawals and deposits, some Binance users began speculating that there’s more happening behind the scenes than either party is willing to disclose at this time.
Is A U.K Crypto Crackdown Taking Place?
One Reddit user said the issue comes down to a failed attempt by Binance to gain regulatory status in the UK via the Binance Markets Limited (BML) entity.
BML was established by acquiring an existing firm, called EDDIEUK Limited, that had already received FCA approval.
The poster claims that a condition of approving the newly formed BML entity was to supply information. Supposedly this included user info and details on the company/group to counter money laundering and terrorist financing etc.
However, Binance refused to hand over this information, leading to a denial of regulatory approval and the current situation in which U.K users cannot on/off ramp.
BML is said to have withdrawn its FCA registration last month after “meeting uncompromising resistance from the regulator.”
The real danger here is that regulatory resistance could leave the U.K stranded as far as crypto innovation is concerned.
However, with hearsay and unconfirmed speculation making the bulk of this report, it isn’t easy to know what to make of this situation.