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UK Financial Regulator Issues Consumer Warning Against FTX

The Financial Conduct Authority has warned that crypto exchange FTX is not authorized to provide financial services or products in the UK.

2 min read
FTX is one if the largest crypto exchanges in the world. Image: Shutterstock

The UK’s Financial Conduct Authority (FCA) has issued a consumer warning against cryptocurrency exchange FTX for operating within the jurisdiction of the United Kingdom without authorization. 

In a statement, the FCA stated that “almost all firms and individuals offering, promoting or selling financial services or products in the UK have to be authorized or registered by us” and that FTX “is not authorized by us and is targeting people in the UK.”

The FCA has been compiling a list of digital asset companies that have registered and adhered to the Money Laundering, Terrorist Financing, and Transfer of Funds Regulations of 2017 since August 2020.

As of today, the 37 firms on that list include crypto exchanges Gemini, Kraken, Galaxy Digital, and eToro, among others, with challenger bank Revolut on temporary registration status.

According to a blog post on the details of registration, the FCA states that “firms that have not ceased trading are at risk of being subject to the FCA’s criminal and civil enforcement powers.” 

It is not clear whether Sam Bankman-Fried’s FTX—headquartered in the Bahamas—will face any immediate fallout from the warning or whether they will have the opportunity to discuss their case with the regulator. 

An FTX spokesperson told Decrypt: "We're looking into the matter and communicating with regulators; as we believe that a scammer is impersonating FTX. The phone numbers listed by the FCA are not from FTX and are listed as a crypto scam here."

The FCA has been notoriously stringent on digital asset companies for many years, having declared that crypto exchange Binance is “​​not permitted to undertake any regulated activity in the UK.” The FCA updated the case two months later, stating that Binance had “complied with all aspects of the requirements” yet is “still unable to conduct regulated business within the UK.”

In the case of unregulated businesses, the FCA warned consumers that, “You will not have access to the Financial Ombudsman Service or be protected by the Financial Services Compensation Scheme (FSCS), so you are unlikely to get your money back if things go wrong.”

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