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FTX Cautioned by UK Financial Watchdog: Details

Mon, 09/19/2022 - 11:05
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Tomiwabold Olajide
This most recent setback coincides with FTX's ongoing expansion efforts
FTX Cautioned by UK Financial Watchdog: Details
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The U.K.'s Financial Conduct Authority has issued a warning to consumers about Sam Bankman-Fried's cryptocurrency exchange, FTX, which it claims is not permitted by the authority to provide financial services or goods in the nation.

According to the regulator, the Bahamas-based crypto exchange "is targeting consumers in the UK," and as investors will not be covered by the nation's ombudsman service and compensation program, they are "unlikely to receive [their] money back if things go wrong."

Similar advice from the FCA was previously given to Binance and its operations in the U.K. Later, similar statements regarding Binance were released by dozens of regulators throughout the world.

In April of this year, the U.K. made its crypto asset register permanent. This program mandates that companies engaging in crypto activity in the nation adhere to the FCA's anti-money laundering rules. FTX, Coinbase and Binance are not on the register, whereas others like Gemini, Kraken and Crypto.com are. Consumers in the U.K. can still access all of these.

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This most recent setback coincides with FTX's ongoing expansion efforts. As a result of the current bear market in the cryptocurrency industry, sources suggest that FTX is raising funds concurrently with a prospective purchase — most likely a retail trading platform. A takeover of a business catering to retail investors would probably result in an influx of new customers for FTX, which has primarily catered to professionals and sophisticated traders.

FTX.US President Brett Harrison recently said the exchange was searching for potential acquisitions. FTX has already begun its foray into the retail sector by introducing its stock trading platform, FTX Stocks, to U.S clients earlier this year.

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Sam Bankman-Fried, co-founder and CEO of FTX, also bought a 7.6% stake in the stock brokerage app Robinhood.

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About the author

Tomiwabold is a cryptocurrency analyst and an experienced technical analyst. He pays close attention to cryptocurrency research, conducting comprehensive price analysis and exchanging predictions of estimated market trends. Tomiwabold earned his degree at the University of Lagos.