A government regulatory body in the United Kingdom stopped the crypto trading operations of Solana-based Pump.fun because the meme coin deployer does not have a permit.
In abiding by the regulatory body’s order, Pump.fun has restricted the access of UK-based traders due to the regulatory roadblock issued by the UK’s financial watchdog.
Operating Without Permission
The United Kingdom’s Financial Conduct Authority (FCA) halted the operation of Pump.fun in the country, tagging the meme coin deployer as a fraudulent entity that is operating without permission.
Once again, Pump.fun captured the attention of the cryptocurrency community after being flagged down by the UK financial watchdog.
The FCA issued a cease-and-desist order to all crypto traders in the UK who are using the protocol, citing that the Solana-based meme coin deployer is operating illegally in the country.
“This firm may be providing or promoting financial services or products without our permission. You should avoid dealing with this firm and beware of scams,” FCA stated on its website.
According to the regulatory agency, it does not authorize the existence of Pump.fun in the UK, saying that the meme crypto is targeting traders in the country.
No Protection From Financial Laws
The FCA told UK residents to defer from using the meme coin deployer, saying if they continued to access it, they might get protection from financial laws in the country.
“You also won’t be protected by the Financial Services Compensation Scheme (FSCS) if things go wrong. This means it’s unlikely you’d get your money back if the firm goes out of business,” FCA explained.
The UK’s regulatory body added that if residents deal with unauthorized crypto firms, they will not have access to the Financial Ombudsman Service if they have a complaint.
The financial watchdog told UK residents to engage only with authorized financial firms, saying that it will give them greater protection if things go wrong.
Denied Access To UK Users
Pump.fun complied with the order from FCA by updating its terms of service which excluded UK-based users from accessing the crypto site.
British users can no longer access the site and receive a notification about why they cannot access the platform, saying that the site is currently unavailable to users in the UK to comply with the laws and regulations of the country.
Pump.fun now joins the growing list of cryptocurrency platforms that are trying to adjust to the regulatory environment in the UK.
As a financial watchdog, the FCA asked all digital asset firms to register with the regulatory body before offering their services to British users.
The financial watchdog is known for its stringent implementation of regulatory standards on crypto firms. Data show that since FCA imposed the rules in 2020, only 47 out of 347 crypto firm applicants have successfully received approval to operate.
However, some critics believe that FCA’s actions are merely reactive and do not fully address the underlying issues of transparency and governance.
Featured image from DALL-E, chart from TradingView