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The Financial Conduct Authority (FCA) has taken action against Rebuilding Society, the UK approver for Binance’s financial promotions compliance, as part of the FCA’s new crypto promotions regime. This move comes shortly after Binance announced its partnership with the peer-to-peer lending platform, Rebuilding Society, to ensure compliance with UK regulations.
Meanwhile, in the latest development, the FCA has extended its financial promotion regulations to cover crypto asset service providers, regardless of their global location.
FCA Intervention On Binance Partner Rebuilding Society
The FCA has imposed restrictions on Rebuilding Society’s ability to conduct financial promotions on behalf of unauthorized crypto-asset service providers. Specifically, the firm is prohibited from approving content for crypto-assets for communication by unauthorized entities, as outlined in the FCA’s OIREQ requirement.
Meanwhile, Rebuilding Society has been given a deadline of 5 pm BST on Wednesday to withdraw any prior approvals for financial promotions granted to unauthorized entities. In addition, the FCA has instructed the firm to inform its clients using its third-party financial promotions service that it cannot approve content from unauthorized sources.
Notably, any advertisements offering financial promotion approval services must also be withdrawn.
Meanwhile, this regulatory intervention comes shortly after Binance’s announcement that it would collaborate with Rebuilding Society to secure financial promotions compliance in the UK. Binance recently said emphasizing that it was partnering with Rebuilding Society due to its FCA authorization and regulatory approval.
Notably, Rebuilding Society introduced its new financial promotions approval service in August, targeting cryptoasset firms in need of regulatory compliance.
FCA’s New Crypto Promotions Rules
The FCA’s updated rules for crypto asset financial promotions took effect on October 8, extending their scope to cover promotions across various media channels, including websites, social media, and online advertising. Failure to adhere to these guidelines can lead to criminal penalties, including imprisonment, fines, or both, under Section 21 of the UK’s Financial Services and Markets Act 2000.
Notably, some regulated entities are authorized to approve promotions on behalf of other crypto companies, facilitating compliance with the new regime.
These regulatory changes have also impacted services like news feeds on crypto platforms, limiting access to users in the UK, including those on Binance and Coinbase. Meanwhile, as the FCA continues to enforce stricter regulations, the crypto industry faces increased scrutiny and the need for comprehensive compliance measures.
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