A growing number of cryptocurrency companies are withdrawing their applications for registration with the UK's Financial Conduct Authority (FCA) amid tighter controls on digital assets. This was reported by Reuters, citing the regulator.
According to the FCA, the number of organisations that withdrew applications for registration increased by 25% in June. At the beginning of the month the agency noted 51 such companies - at the moment there are 64 of them.
At the time of writing, there are six companies on the FCA register. Applications from more than 80 organisations are still pending.
A spokesperson for the authority also told the publication that Binance withdrew its application in mid-May, without giving further details.
On 26 June, the FCA banned the UK unit of the bitcoin exchange from carrying out any regulated activities without prior written approval from the authority.
A Binance spokesperson noted that the company works closely with regulators and law enforcement agencies "to improve the safety and resilience of the industry by providing users with better services and protection."
Earlier, Mark Stewart, head of enforcement and market surveillance at the FCA, said there were more than 100 companies operating in the UK that were not registered with the authority. He said the activities of such organisations threaten the financial system.
"We have a number of firms that are clearly doing business in the UK without our permission. They work with banks, payment services companies and consumers. This is a very real risk, so we are concerned about this," he said.
In December 2020, the FCA introduced a temporary registration regime for cryptocurrency companies awaiting regulatory approval. It was expected to last until 9 July 2021.
In June 2021, the authority extended the regime until 31 March 2020. The FCA felt that the initiative would allow companies involved in the digital asset industry to continue operating while the Authority "conducts a thorough assessment".
As a reminder, the FCA estimates that the number of cryptocurrency investors in the UK grew from 1.9 million to 2.3 million in one year.