Binance, the global cryptocurrency exchange, is reportedly encountering difficulties in securing new partners for its re-entry into the UK market, according to sources familiar with the matter cited by Bloomberg. Local regulations stipulate that Binance must have an authorized approver to re-establish its presence in the UK, and these approvers are designated by the Financial Conduct Authority (FCA) to ensure compliance with FCA rules in financial promotions. Binance has allegedly faced rejection from at least three companies pursuing regulatory licenses in recent months. The exchange lost its UK partner in October when the FCA imposed restrictions on then-approver Rebuildingsociety.com (REBS), leading to the halt of new user registrations and the search for new approvers.
The FCA expressed concerns about businesses considering partnerships with Binance, leading to some entities abandoning transactions with the cryptocurrency exchange. Binance, however, denies encountering challenges in finding new partners, stating that it is inaccurate to claim rejection by UK Article 21 approvers. The exchange asserts that it will continue productive discussions with potential approvers and anticipates securing positive approvals soon. Binance officially canceled its registration with the FCA in May 2023 through its subsidiary Binance Markets Limited, terminating its regulatory license for activities it never conducted in the UK.
The difficulties in the UK may be linked to Binance's legal issues abroad, particularly the lawsuit filed by the U.S. Securities and Exchange Commission (SEC) in June 2023. The SEC accused Binance and its former CEO Changpeng Zhao of offering unregistered securities and engaging in false trading, among other charges. Zhao admitted to violating U.S. anti-money laundering requirements and agreed to step down as CEO as part of a $4.3 billion settlement with the U.S. Department of Justice. His sentencing is scheduled for late February, contributing to the challenges faced by Binance in rebuilding its presence in the UK market.
