Revolut will temporarily halt certain cryptocurrency services for its business customers in the UK. This step is a response to upcoming regulatory changes by the Financial Conduct Authority (FCA).
According to a report by City A.M., the fintech firm disclosed its decision to suspend the ability to purchase cryptocurrencies via Revolut Business starting January 3, 2024. This is in accordance with the FCA's new guidelines on crypto assets.
Navigating Regulatory Changes
Recently, the FCA signaled imminent guidelines that have prompted Revolut to temporarily suspend cryptocurrency purchases for Revolut Business users. Nonetheless, business customers can still retain and sell their existing cryptocurrencies. This change will not impact the company's retail customers.
The FCA's impending regulations involve provisions aimed at protecting investors in the volatile digital asset space. Central to these rules is a mandatory 24-hour "cooling off period" for investors engaging in crypto transactions.
Additionally, incentives like "refer a friend" bonuses will be banned. This move seeks to mitigate potential speculative behavior in the market. Scheduled to be enforced for registered crypto firms from January 8, 2024, the FCA has granted a transition period for companies to make the necessary adjustments.
Revolut Joins Major Firms
Revolut is one of many companies in the crypto industry adjusting its operations ahead of the FCA's new requirements. In August, PayPal announced a temporary suspensionof its crypto sales in the region, taking effect on October 1. However, the company reassured its users that they could still hold or sell their existing crypto assets.
PayPal's decision aligned with a growing trend among financial institutions in the UK. Major banks like HSBC, NatWest, and First Direct have already imposed daily transaction limits on cryptocurrencies, echoing a broader shift toward regulatory compliance.
Last month, the FCA updated its guidance for crypto asset firms in response to new regulations governing promotions targeting consumers in the UK.
Despite the regulations having been in place for a while, numerous firms reportedly struggle to comply with the FCA's requirements. This has led the regulator to introduce fresh guidelines. The FCA's updated guidance enables firms to adjust their marketing activities with the recently implemented "Consumer Duty" Act.
Lucy Castledine, the FCA's Director of Consumer Investments, underscored the integration of the new crypto marketing rules with existing high-risk investment regulations. This step showcases a concerted effort toward consumer protection, Finance Magnates reported.
This article was written by Jared Kirui at www.financemagnates.com.
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