By Val Smith
Our standards are setting the stage for a thriving, competitive crypto sector in which people and our financial markets’ integrity are protected.
We often get asked about the number of firms we’ve registered, as well as the process itself. Some have suggested we’re too tough on crypto firms, setting the bar too high for registration. It’s even been said our approach could stunt innovation and call into question the UK’s position as a global financial leader.
We never turn applications down out of hand. But we treat the risk of firms being used for money laundering extremely seriously. Allowing illicit money to flow freely can destroy lives. Terrorism, organised crime, sanctions evasion and human trafficking are just some of the real-world issues we’re helping tackle by maintaining the standards the Money Laundering Regulations (MLRs) require.
Relaxing our standards and creating a race to the bottom also won’t ensure people and our markets are protected or even work well. Innovations built quickly on unsafe, unregulated and untrusted foundations become a house built on sand – likely to collapse. Instead, we want to closely collaborate with partners across government, industry and other jurisdictions to develop a crypto sector that’s built on reliable, sturdy foundations. By doing this we can help enable safety, security and sustainable growth for years to come.
– Val Smith is head of payments and digital assets, authorisations division
Setting the stage for success
Keeping financial crime out of our markets is critical. So too is enabling trust in our financial system. We know that setting and maintaining standards people can trust is a key part of any thriving, competitive sector. That’s why we hold all firms seeking registration, not just crypto firms, to strong and universal standards.
But we also know the crypto industry is still developing, and this can present challenges for those adapting to new regulatory processes. We actively want to work with you. Engage with us early through our pre-application meetings and use the wide range of practical support we offer throughout the process.
No 2 registration applications are ever the same. So, our guidance, pre-application meetings and practical examples are there to help each individual applicant. Our decision on whether to register isn’t just based on the controls and systems firms have in place. We look at the environment they operate in, the people involved in these processes and the customers they want to reach. All this means the time it takes to reach a decision can and will vary.
I’m sure the number of crypto firms we’re registering will remain under the spotlight as we continue to set out the UK’s crypto regulatory regime. Equally, our focus must remain fixed on doing our job, protecting consumers and the vital integrity of our financial system. What we will do is support prospective firms to meet the required standards and only register firms that do. We’ll continue to weed out those that can cause harm. Because these standards underpin our vision of a healthy, globally competitive and vibrant crypto sector in the UK. By upholding regulatory standards like the MLRs, we aren’t just protecting the present, we’re safeguarding the future.
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