Eight months following the Financial Conduct Authorities (FCA’s) initial plan, the United Kingdom regulatory agency has placed crypto asset management companies in the financial crimes reporting category.
The FCA had recently verified the regulation in a Policy Statement that had been published on its website on Wednesday. This action follows the British financial regulator’s decision to raise the number of companies mandated to send an annual financial crime report identified as “REP-CRIM” from approximately 2,500 to over 7,000.
When the proposal was first disclosed in August 2020, the FCA claimed that it was part of a set of proposals to integrate a data-focused approach to fintech regulation. With financial crimes reporting obligations being required regardless of the crypto broker firm’s gross annual sales volume.
Cryptoasset businesses are defined by the FCA as cryptocurrency brokerages, exchanges and custodial wallet providers. The prerequisite for REP-CRIM reporting reflects the regulator’s extended regulation of the digital currency space that requires mandatory registration for cryptoasset businesses.
From 2020 onwards, the FCA has been overseeing the Anti-Money Laundering enforcement of U.K. cryptoasset firms. The FCA was forced to establish a transitional licensing regime in December 2020 due to a shortage of Cryptoasset firms registration submissions.
Additionally, the FCA’s retail derivatives trading ban came into effect in January 2021.
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