Financial technology company Revolut has announced its plans to suspend cryptocurrency purchases for its business clients in the United Kingdom. The move comes as a response to the new rules on crypto promotion set by the country’s Financial Conduct Authority (FCA), which will come into effect in January 2024.
Revolut states that the temporary suspension of crypto purchases for its UK business customers will allow the company to make the necessary adjustments required by the FCA. From January 3, 2024, these customers will only be able to sell and hold cryptocurrencies through Revolut Business, according to a report from City A.M. This adjustment aims to ensure that the new regulatory requirements are met and enhance the customer journey.
In an email sent by Revolut to its business clients, the company highlights the need to provide additional protection for investors of crypto assets. However, the email does not mention any impact on Revolut’s retail customers, suggesting that the suspension only affects business clients.
Revolut received approval from the FCA in September to offer cryptocurrency services to customers in the UK and was included in the regulator’s crypto asset firm register. However, in August, the company announced that users in the United States would no longer be able to buy crypto on its platform, citing the lack of regulatory clarity at the time. This recent move by Revolut reflects the ongoing challenges faced by financial institutions in navigating the regulatory landscape surrounding cryptocurrencies.
Revolut is not the only financial institution taking action in response to the FCA’s regulations. PayPal, a global online payments company, also announced in August that its UK customers would not be able to buy crypto via its platform starting in October. However, PayPal expressed its intention to reinstate this functionality in early 2024. Additionally, Binance, a major crypto exchange, recently stopped accepting new users in the UK due to the FCA’s restrictions on its local partner approving crypto promotions.
The FCA maintains strict regulatory oversight over the crypto industry and places a strong emphasis on consumer protection. While the agency’s core rules on crypto marketing became effective on October 8, 2023, it granted a three-month extension to allow firms to implement features requiring technical development. This extension provides businesses until January 8, 2024, to fully comply with the FCA’s regulations.
Revolut’s decision to halt cryptocurrency purchases for its UK business clients is a response to the upcoming regulatory changes set by the FCA. This move aims to ensure compliance with the new rules and enhance the protection of crypto asset investors. As the crypto industry continues to evolve, financial institutions must navigate the complex regulatory landscape and adapt their services accordingly.
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