CEX.IO Resumes UK Operations After Complying with FCA Requirements
Date: 2024-09-13 Author: Gabriel Deangelo Categories: BUSINESS
Cryptocurrency exchange CEX.IO has resumed operations in the UK after successfully completing the requirements of the Financial Conduct Authority (FCA).
The company voluntarily suspended its services in the UK following the introduction of new FCA rules on the promotion of financial crypto assets in October 2023.
Prior to the suspension, the UK was an important market for CEX.IO, with 69% of its clients from the European Economic Area located there, according to a press release. .
CEX.IO Offers Access to 190 Digital Assets
The exchange currently offers access to 190 digital assets for its users in the UK.
“We are committed to strengthening our presence in the UK, meeting new regulatory standards and supporting the region’s growth as a cryptocurrency market hub,” said Rich Evans, managing director of CEX.IO UK.
He also highlighted CEX.IO’s strong security measures and impeccable track record of compliance over the company’s 11 years of operation.
According to Evans, prioritizing compliance and customer trust has always been at the core of the company’s business model, even if it has come at the expense of short-term growth.
While CEX.IO is still in the process of gaining full Anti-Money Laundering (AML) registration from the FCA, the exchange has been able to re-enter the UK market through a partnership with Gateway 21 .
The FCA-authorized company acts as an Approving Financial Promoter, helping CEX.IO comply with regulations.
CEX.IO currently operates its services out of Lithuania, a strategy increasingly used by crypto companies to adapt to UK regulation.
For example, crypto lender Nexo recently relaunched in the UK through a similar agreement with Gateway 21.
As part of the regulatory compliance process, cryptocurrency firms operating in the UK must implement measures such as cooling-off periods and risk warnings tailored specifically to UK customers.
In addition, users are required to complete investor assessment questionnaires and assessments to ensure their investment decisions are in line with their financial capabilities.
These steps have become standard practice for cryptocurrency firms operating in the UK under the new regulatory regime.
CEX.IO started out as a Bitcoin mining pool
CEX.IO’s history dates back to 2013, when it launched as the GHash.IO mining pool.
The pool brought together miners who collectively mined over 583,000 Bitcoins before ceasing operations.
At its peak, GHash.IO controlled nearly 51% of the Bitcoin hashrate, raising concerns in the crypto community over the risk of a 51% attack, in which the pool could theoretically manipulate transactions.
To avoid this, several miners left the pool, and GHash.IO eventually shut down.
The FCA’s new rules on crypto promotion, which came into effect in October 2023, were aimed at increasing transparency in marketing in the sector.
Since their introduction, the FCA has issued more than 450 warnings regarding illegal advertising campaigns.
The regulator is strictly enforcing these rules, warning that even social media posts such as crypto memes can breach the rules.
Cryptocurrency exchanges such as Coinbase and Binance have responded by changing their services for UK users to avoid non-compliance.
The new regulatory framework has proven challenging for many companies, with some, such as Bybit, choosing to leave the UK market entirely.
However, several major exchanges, including Coinbase, OKX and Binance, have partnered with FCA-authorised third parties to continue operating in the UK.
