Bitcoin rises after UK financial watchdog bans Binance cryptocurrency exchange

In the wake of the British financial watchdog’s decision to ban one of the world’s largest Bitcoin (BTC-USD) exchanges from operating in the country, the cryptocurrency market shrugged.

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The Financial Conduct Authority (FCA ordered Binance Markets) over the weekend to remove all advertising and financial promotions by 30 June. FCA said the firm cannot perform any regulated activities in Britain without prior consent, which is one of its most significant actions.

Binance, which was founded by Chinese-Canadian developer Changpeng Zhao, is now required to make clear on its website, social media platforms, and in all communications that it is no longer allowed to operate in the UK.

Bitcoin’s price rose over 5% on Monday to $35,017 (£25,188) but remains lower than at the beginning of the month because of China’s crackdown on bitcoin miners.

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Ethereum (ETH-USD), the world’s second-largest cryptocurrency, gained 10% as average transaction fees dropped to their lowest level since December 2020. Elon Musk-favourite dogecoin (DOGE-USD) also climbed 3.4%.

According to CoinGecko, the overall crypto market rose around 8% to $1.43tn on Monday morning.

Bloomberg reported bitcoin is being defended well at $30,000 with several tests at that level over the past month, according to Luno Poe’s Asia-Pacific head Vijay Ayyar.

“We saw a lot of downward pressure on prices being defended, so this looks quite bullish at this point.”

Globally, money laundering and fraud cases are rising because of a crackdown on the cryptocurrency sector. It comes just days after the Japanese financial regulator issued a consumer warning against Binance.

Regulatory agencies in the US and Germany have also complained about the firm’s past behaviour.

The FCA has required that crypto-related businesses register with them before doing business in the UK since this year, but most firms have been granted “temporary registrations” until July. Just five firms registered this month, and the majority were still not compliant, according to the watchdog.

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“Binance Markets does not provide any services or products via Binance.com,” the exchange said on Twitter on Sunday. The Binance Group gained BML May 2020 and has not yet launched its UK business or used its FCA regulatory permissions.”

Binance Group is headquartered in the Cayman Islands, while Binance Markets Limited is headquartered in London.

The cryptocurrency market has shrugged off news of Britain’s financial watchdog banning one of the world’s largest Bitcoin (BTC-USD) exchanges from operating in the country.

Over the weekend the Financial Conduct Authority (FCA) ordered Binance Markets to remove all advertising and financial promotions by Wednesday 30 June. In one of the most significant moves by a regulator to date, the FCA said that the firm must not carry out any regulated activities in Britain without prior consent.

Binance, which was founded by Canadian-Chinese developer Changpeng Zhao, is now required to make clear on its website, social media platforms, and all other communications that it is no longer permitted to operate in the UK.

Despite the ban, Bitcoin rose over 5% on Monday to $35,017 (£25,188), although it is still lower than at the start of the month following China’s recent crackdown on bitcoin miners.

The wider cryptocurrency market also pushed ahead, with ethereum (ETH-USD), the world’s second-largest coin, up 10% as average transaction fees on the coin dropped to their lowest since December 2020. Elon Musk-favourite dogecoin (DOGE-USD) also climbed 3.4%.

According to CoinGecko, the broad crypto space was up around 8% to $1.43tn on Monday morning.

“We’re seeing the $30,000 level on bitcoin being defended well with many tests at that level over the past month,” Vijay Ayyar, head of Asia-Pacific at crypto exchange Luno Pte, told Bloomberg.

“We saw a lot of downward pressure on prices being defended, so this looks quite bullish at this point.”

It comes amid a crackdown on the cryptocurrency sector as money laundering and fraud cases rise globally. It also comes just days after the Japanese financial regulator issued a consumer warning against Binance.

US and German regulators have also raised concerns over the firm’s activities in the past.

Since the start of this year, crypto-related businesses must register with the FCA before doing business in the UK, however, most firms have been granted “temporary registration” until July. Earlier this month, the watchdog said that just five firms had registered and that the majority were not yet compliant.

On Sunday, Binance said on Twitter: “Binance Markets ‘does not offer any products or services via the Binance.com website’. The Binance Group gained BML May 2020 and has not yet launched its UK business or used its FCA regulatory permissions.”

Someone currently base Binance Group in the Cayman Islands, while Binance Markets Limited is an affiliate firm based in London.

A spokesperson for the FCA said: “A significantly high number of crypto assets businesses are not meeting the required standards under the money laundering regulations, which has resulted in an unprecedented number of businesses withdrawing their applications.

“The action taken today on Binance Markets Limited has been in train for some time.”

Of the firms assessed, over 90% have withdrawn applications following the FCA’s intervention.

Institutional support for cryptocurrency has increased in recent months. Besides Tesla (TSLA), several companies, including MicroStrategy (MSTR), have invested billions of dollars in cryptocurrency, and traditional financial firms like PayPal (PYPL) and Goldman Sachs (GS) are handling the asset on behalf of clients.

Someone has staunchly opposed governments and central banks to regulating digital currencies.

The governor of the Bank of England (BoE) has said that digital currencies will not get a license in the future despite their innovation potential, repeating his earlier view that bitcoin is not money and does not have intrinsic value.

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