Binance, the world’s largest cryptocurrency exchange, has taken a strategic step to align itself with the United Kingdom’s stringent financial promotions rules. The move comes as the UK’s Financial Conduct Authority (FCA) implements a series of regulatory changes aimed at safeguarding investors participating in the crypto market.

In June, the FCA unveiled an overhaul of marketing regulations concerning digital assets, with a focus on enhancing investor awareness of associated risks and curbing misleading advertisements and incentivizing promotional schemes. These new financial promotion rules are set to come into effect on October 8, 2023.

Binance’s Response to Regulatory Changes

In response to these regulatory changes, Binance has announced the launch of a dedicated domain for its UK users. The new domain, accessible at www.binance.com/en-GB, has been designed to offer products and services that align with the incoming marketing regulations. These services include fiat and cryptocurrency deposits and withdrawals, spot trading, margin trading, Binance Pay, and cryptocurrency loans, among others.

However, in adherence to the new rules, certain Binance services will no longer be accessible to users in the UK. These services include Binance gift cards, the academy, research resources, the feed feature, and referral bonuses.

Partnership with Authorized Promotion Agency

To further ensure compliance with the FCA’s regulatory framework, Binance has established a partnership with Rebuildingssociety.com Limited, an FCA-registered promotions firm. This partnership will involve the approval of all marketing and promotional materials used by the exchange.

The FCA had earlier outlined multiple legal routes for communicating financial promotions to UK consumers under its new advertising regime. Binance appears to have opted for promotions that are approved by an authorized person, as recognized by the FCA handbook. Alternative methods of marketing under the UK’s new financial promotion regulations include direct promotion by an authorized entity or promotion by crypto asset firms registered with the FCA.

It’s worth noting that Binance had previously submitted a registration application to the FCA but later withdrew it for undisclosed reasons.

European Regulation on the Horizon

In parallel, European regulators are progressing with the implementation of the Market in Crypto Assets (MiCA) regulations. The European Securities and Market Authority (ESMA) has issued its second consultation paper for MiCA, seeking feedback from stakeholders across the crypto industry. This consultation covers various aspects, including sustainability criteria for distributed ledgers, trade transparency measures, and technical specifications for white papers, among others.

Stakeholders are invited to provide their feedback on this consultation by December 14, 2023. ESMA plans to release a third and final consultation package on MiCA regulations in Q1 2024. Following this, ESMA will draft and submit its final report, incorporating all received feedback, to the European Commission for approval before or on June 30, 2024.

The MiCA regulations, considered the first comprehensive legislative framework for the crypto industry, are expected to be adopted by all European Union member states upon their launch in 2024. These regulations aim to bring a new level of oversight and regulation to the cryptocurrency market across the EU.