- The FCA has warned British users over the fact that the exchange isn’t regulated
- The financial watchdog has issued similar warnings over Bitmex and Binance
- Users who experience problems cannot complain to the financial ombudsman
Britain’s financial regulator, the Financial Conduct Authority (FCA), recently issued a warning over cryptocurrency exchange FTX operating in the UK without a licence. The agency, which has warned over Binance and crypto exchanges in general in the past, repeated its now familiar warning that users should “be wary of dealing with this unauthorised firm” and learn how to protect themselves from any bad acting on behalf of the firm.
No Recourse to Support
The warning over FTX, issued on Friday, began by warning users that, “We believe this firm may be providing financial services or products in the UK without our authorisation”. The short notice went on to explain the importance of this:
This firm is not authorised by us and is targeting people in the UK. You will not have access to the Financial Ombudsman Service or be protected by the Financial Services Compensation Scheme (FSCS), so you are unlikely to get your money back if things go wrong.
The warning is the same as that issued over Bitmex and Binance in the past, and doesn’t mean that there is suddenly something wrong with using FTX – it’s no more or less dangerous than it was before, but the FCA is reinforcing the fact that it cannot protect users if it suddenly decides to rug pull.
FCA Cannot Ban FTX
The FCA cannot ban UK crypto traders from using FTX because it is not registered in the country, so all it can do is warn citizens over the dangers of using it. Nevertheless, FTX is still one of the better regarded exchanges in the crypto world and is the leverage trading platform of choice for many crypto traders, and the FCA’s comments won’t change the habits of those that use it.