Recently, Coinbase, one of the leading crypto companies, faced a significant setback in the UK. The Financial Conduct Authority (FCA) fined its subsidiary, CB Payments Limited (CBPL), a hefty sum of £3.5 million for breaching Anti-Money Laundering regulations. This fine was a result of CBPL’s repeated violations of the FCA’s guidelines, despite agreeing to strengthen its financial crime control policies in 2020.
The FCA found that CBPL continued to onboard and serve high-risk customers, totaling 13,416 individuals. These customers deposited a substantial amount of money on the platform, which was then used for crypto transactions on other Coinbase platforms. As a result, the FCA concluded that CBPL failed to comply with the recommended controls, increasing the risk of financial crime being facilitated on the platform.
In contrast to Coinbase’s troubles, Revolut, another prominent crypto company, received a restricted banking license from the UK’s Prudential Regulation Authority (PRA). This license, which came after more than three years of application, signifies a significant milestone for Revolut as it enters the mobilization stage. Francesca Carlesi, UK CEO of Revolut, emphasized the responsibility that comes with being a bank in the UK and pledged to offer products and services that benefit all users.
Revolut has made significant strides in the crypto industry, launching Revolut X, a standalone crypto exchange tailored for retail customers. This move showcases Revolut’s commitment to expanding its crypto offerings and providing more accessible services to its user base.
The contrasting fortunes of Coinbase and Revolut in the UK highlight the importance of regulatory compliance and responsible banking practices in the crypto industry. While Coinbase faced regulatory scrutiny and fines for AML breaches, Revolut secured a restricted banking license, signaling its commitment to providing innovative financial products and services to its customers. As the crypto industry continues to evolve, companies like Coinbase and Revolut must navigate regulatory challenges while striving to enhance their offerings and maintain the trust of their users.