The recent announcement from the United Kingdom’s central financial regulator – Financial Conduct Authority (FCA) will certainly pose more challenges for the development of Bitcoin ATMs. According to its latest statement, all non-registered Bitcoin ATMs must be shut down immediately if they don’t want to face further action from the government.
This, however, is not an abrupt decision. Cryptocurrencies are fluctuating assets with extremely high risks, and at this point there has been no effective regulatory structure to monitor the trading activities within this industry. In addition, none of the cryptoasset firms have been approved to offer ATM services, hence their activities can be deemed illegal and incompliant with UK Money Laundering Regulations (MLR).
“We are concerned about crypto ATM machines operating in the UK and will therefore be contacting the operators instructing that the machines be shut down or face further action.”
Ever since August 2020, 33 crypto companies have received registration approval from the FCA under the MLR framework, including some of the leading firm such as: Gemini Europe Ltd, Kraken’s holding company Payward Ltd, Galaxy Digital UK Limited and eToro (UK) Ltd (eToro got their approval earlier this year in January).
The FCA also granted temporary registration status to 22 other companies, but their status will expire by March 31, 2022. After this time, the FCA will decide whether or not these companies can get their official approval. Some of the companies on the temporary list are Blockchain Access UK Limited (blockchain.com), Copper Technologies (UK) Limited, Revolut Ltd and Wirex Ltd.
Coin ATM Radar conducted an analytical data and found out that there are currently 81 Bitcoin ATMs within the U.K., owned by 8 companies. According to the FCA, among the 33 companies with official registration approval, none have filed documents to attain licenses to operate Bitcoin ATMs. Every economic activity through these ATMs, therefore, are against the laws.
This is not the first time FCA has to issue a warning. November 15th, FCA declined the application from Gidiplus Limited to provide crypto asset automated teller machine (CATM) services. Their application was turned down because Gidiplus had failed to meet the registration conditions under the MLR law. A few weeks later, on December 3rd, Gidiplus tried to appeal FCA’s decision but the verdict remained unchanged. FCA stated that they “lack of evidence as to how Gidiplus would undertake its business in a broadly compliant fashion pending determination of its appeal.”
