Santander UK joins Barclays in blocking payments to Binance after regulator clamps down on the crypto exchange

2018 10 04T160021Z_1594229591_RC1364CE96F0_RTRMADP_3_MALTA CRYPTOCURRENCY.JPG
Binance CEO, Changpeng Zhao.

  • Santander’s UK unit has joined Barclays in blocking customer payments to crypto exchange Binance.
  • The FCA, the UK financial watchdog, has banned Binance from trading regulated derivatives.
  • A series of countries have been cracking down on the crypto exchange, including Poland and Japan.
  • Sign up here for our daily newsletter, 10 Things Before the Opening Bell.

Santander UK has joined rival banks Barclays and NatWest in stopping its customers from making payments to Binance after the national regulator said the cryptocurrency exchange was not allowed to trade regulated derivatives.

In a customer update sent via email on Thursday, Santander told its UK clients the bank would block payments to Binance for their client safety and protection. Customers could however still receive funds from Binance.

“We’re taking this step as we want to do everything we can to protect you and keep your money safe.” the email said.

The bank cited the FCA’s statement warning consumers about Binance and said they were making the change to protect customers from fraud.

“In recent months, we have seen a large increase in UK customers becoming the victims of cryptocurrency fraud. Keeping our customers safe is a top priority, so we have decided to prevent payments to Binance following the FCA’s warning to consumers.” Santander’s UK customer service account added via Twitter in response to a complaint about the ban.

Santander’s customers had taken to the social media platform to protest the ban and suggest they would close their accounts with the bank unless it reversed its decision

The Financial Conduct Authority told Binance in late June it had to halt regulated activities unless it obtained prior written permission from the regulator. The FCA effectively banned the crypto exchange’s UK-listed entity, Binance Markets, from offering crypto derivatives.

A series of UK-based financial institutions have since stopped their customers from making payments to the crypto exchange platform, among them Barclays and NatWest, which are some of the biggest retail banks in the country.

Binance’s main exchange is not UK-based, so people in the country who buy and sell cryptocurrencies via its platform will not be affected by the ban, the crypto exchange provider said at the time of the ban.

Binance has been in the hot seat in various countries now – most recently the Polish regulator urged caution, while Thailand’s Securities and Exchange Commission filed a criminal complaint against the company for unlicensed operating.

Japan’s regulator had also issued a warning about Binance operating in the country despite not having obtained a license to do so and the crypto exchange risks being fined in Germany for offering digital tokens that track securities without presenting an investor prospectus, according to Reuters.

On Wednesday, the day before Santander’s announcement, Binance’s CEO Changpeng Zhao wrote a blog post addressing the regulatory crackdown. He said he welcomed regulation as it helped the industry grow and that Binance was focused on its customers best interests.

“Compliance is a journey – especially in new sectors like crypto. […] Binance has grown very quickly and we haven’t always got everything exactly right, but we are learning and improving every day. We hope to clarify and reiterate our commitment to partner with regulators, and that we are proactively hiring more talent, putting in place more systems and processes to protect our users.” he wrote.

Read the original article on Business Insider

Crypto exchange Binance plans to double the size of its global compliance team as regulators turn up the heat

CZ 5 (2)
Binance CEO, Changpeng Zhao.

  • Binance plans to give its global compliance team a two-fold boost by the end of 2021.
  • “We plan to double our team size by the end of the year,” CEO Changpeng Zhao said on Tuesday.
  • Legal pressure has begun mounting on Binance, making it unable to operate smoothly in some regions around the world.
  • Sign up here for our daily newsletter, 10 Things Before the Opening Bell.

Binance plans to double the size of its global compliance team by the end of 2021 as the industry faces “a lot of uncertainty,” CEO Changpeng Zhao said in an open letter on Tuesday.

Zhao said the company’s international compliance team and advisory board has already grown by 500% since last year.

Former Financial Action Task Force executive secretary Rick McDonell, former head of the Canadian delegation to the FATF Josée Nadeau, and former US Ambassador to China Max Baucus are among the high-profile appointments on the team.

“We plan to double our team size by the end of the year, with qualified and experienced advisors to support,” Zhao said in his letter.

Binance has been under fire over a series of regulatory threats. Pressure first began mounting from Ontario, Canada, where a regulator alleged that the company failed to comply with securities laws.

Then the UK’s Financial Conduct Authority banned Binance’s local subsidiary, ordering it to stop all regulated activity in the country. The Cayman Islands too, where Binance was incorporated in 2017, said the exchange isn’t authorized to operate crypto trading in the nation. Officials in Thailand also filed a criminal complaint against the exchange last week for operating without a license.

Soon after, UK bank Barclays blocked customers from making card payments to Binance, saying this was done to help keep customers’ money safe.

In an email to users on Tuesday, Binance said it would suspend euro bank deposits from a key European payment network (the Single Euro Payments Area) due to “events beyond our control.” It described the suspension as temporary, according to the Financial Times.

In his letter, CEO Zhao compared crypto adoption to the invention of the car industry to explain that laws and guidelines for road traffic took a while to develop.

“Crypto is similar in the sense that it can be accessible for everyone, but frameworks are required to prevent misuse and bad actors,” he said.

“Binance has grown very quickly and we haven’t always got everything exactly right, but we are learning and improving every day.”

A fresh wave of regulatory clampdowns has set off panic investor behavior and willingness to sell at a loss, bringing cryptocurrency prices down from their peaks earlier this year. Bitcoin was last trading at $34,824 on Wednesday, down around 0.2% on the day. It’s still up 21% so far this year, but has lost 45% since hitting a record in April. Ripple’s XRP fell 1% to 67 cents on Wednesday, while litecoin fell 0.4% to $141.60.

Read More: Goldman Sachs names 30 stocks to buy for double-digit revenue growth in 2022 – and 4 sectors expected to beat the S&P 500’s sales growth

Read the original article on Business Insider