Sam Bankman-Fried, former CEO of FTX, speaking at the Binance Blockchain Week, Singapore, 19 January, 2019. Binance
The United Kingdom’s Financial Conduct Authority (FCA) has warned investors that crypto exchange FTX was not authorized to provide services in the country, the agency said in a notice on Friday.
According to the chief financial regulator, the Bahama-based crypto exchange was believed to be providing financial products and services in the U.K., without the FCA’s authorization, and as such has been added to the growing list of unregistered crypto-related businesses. By the end of August, the list of FCA-registered companies included only around 37 entities, with the latest to join being Crypto.com.
The FCA noted that users who interact with unauthorized firms are unable to access the Financial Ombudsman Service, which helps individuals settle disputes with companies. These customers are also not protected by the Financial Services Compensation Scheme (FSCS), making it unlikely for them to get their money back “if things go wrong”.
On 19 September, a spokesperson for FTX told Bloomberg the exchange was aware of the notice, and that it believed a “scammer is impersonating FTX”. The spokesperson pointed out that the company phone numbers the FCA had listed were not connected to the FTX exchange in any way, that they were “listed as a crypto scam”.
While it was classified as a unauthorized business in the U.K., the exchange had great success in Europe. Last week, FTX was granted a Cyprus Investment Firm License which allows it to serve the entire European Economic Area, including the E.U., Norway, Iceland, and Liechtenstein. The founder and CEO of FTX, Sam Bankman-Fried, said in a statement at the time:
“Securing this license in the European Union is an important step in achieving our goal of becoming one of the most regulated exchanges in the world. We are continuing to work with CySEC and regulators across the globe to be the leader in the digital asset industry when it comes to meeting the financial standards that are expected of traditional financial institutions.”