Bitcoin ATMs are a technical solution to the cryptocurrency’s fast expansion. The Financial Conduct Authority has advised cryptocurrency ATM operators in the United Kingdom to take down them. Otherwise, they may risk legal action. In this article, find out the reasons for that solution.
According to the BBC, the Financial Conduct Authority (FCA) of the United Kingdom ruled all cryptocurrency ATMs unlawful. The country’s financial authority stated that it had not allowed any of the registered cryptocurrency enterprises authorization to use the services of the particular ATMs. Also, operators may continue offering cryptocurrency services if they have secured licenses in the United Kingdom. However, it is not an easy deal since the operators have to set up activities in compliance with MLR standards.
Cryptocurrencies ATMs enable users to purchase bitcoin in exchange for cash. In most cases, we’re talking about bitcoins, however, certain terminals accept other prominent cryptocurrencies. Some crypto ATMs allow users to withdraw funds from their wallets in fiat currency as well as acquire cryptocurrencies. Also, crypto ATMs interface with the blockchain over the Internet and provide the user with the address to which the cryptocurrency is sent. It also includes the QR code to make transactions. This way cryptocurrency is transferred from one of the ATM’s owner’s wallets.
What do the media think about that?
According to the British media, the regulator’s decision came following a court dispute against Gidiplus, the ATM network. After the FCA refused the company a license, its representatives decided to appeal the regulator’s decision to the court. However, the judge sided with the regulator. During the hearing, it became evident that Gidiplus did not acquire the license since insufficient client information was collected. ATMs did not demand personal information for deposits under £250, according to the FCA. So, this might have aided in money laundering.
The FCA advises the British that the cryptocurrency market is unregulated and there is a significant risk that customers will be unprotected if they lose money. The regulators also issued a list of operators that sell cryptocurrency but have not registered with the FCA or passed a money laundering test. Since then, 110 of the businesses on the list have ceased operations. According to the Coin ATM Radar tracker, there are around 81 operational bitcoin ATMs across the country, the majority of which are found in supermarkets and convenience stores. Previously, the FCA claimed that in the first six months of 2021, it processed 300 complaints involving unregistered cryptocurrency industry enterprises.
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