Revolut, the popular fintech firm, has announced a temporary suspension of certain cryptocurrency services for its business customers in the UK.
This decision is in response to upcoming regulatory changes set forth by the Financial Conduct Authority (FCA), as reported by City A.M.
Starting on January 3, 2024, Revolut Business users will no longer have the ability to purchase cryptocurrencies through their accounts, aligning with the FCA’s new guidelines on crypto assets.
The impending regulations by the FCA are primarily designed to safeguard investors in the volatile digital asset space.
A key provision within these rules is the implementation of a mandatory 24-hour “cooling off period” for individuals involved in cryptocurrency transactions.
Furthermore, incentives such as “refer a friend” bonuses will be banned to curb potential speculative behavior in the market.
These regulations are slated to be enforced for registered crypto firms from January 8, 2024, with a transition period granted to allow companies to make necessary adjustments.
It’s important to note that while Revolut Business will temporarily suspend cryptocurrency purchases, business customers will still be able to hold and sell their existing cryptocurrencies.
This move will not affect Revolut’s retail customers, who can continue to use the platform for their cryptocurrency needs.
Revolut is not the only company in the crypto industry making adjustments to comply with the FCA’s new requirements.
In a similar vein, PayPal had previously announced a temporary suspension of crypto sales in the region, effective from October 1.
However, PayPal assured its users that they could still retain or sell their existing crypto assets.
The trend of financial institutions in the UK adapting to these regulatory changes is widespread.
Major banks like HSBC, NatWest, and First Direct have already imposed daily transaction limits on cryptocurrencies, reflecting a broader shift toward regulatory compliance.
In response to the evolving regulatory landscape, the FCA recently updated its guidance for crypto asset firms, particularly in relation to marketing practices targeting consumers in the UK.
The introduction of the “Consumer Duty” Act has prompted these changes, allowing firms to align their marketing activities with the new regulations.
Lucy Castledine, the FCA’s Director of Consumer Investments, emphasized the integration of these new crypto marketing rules with existing high-risk investment regulations, highlighting the regulator’s commitment to consumer protection.
These collective efforts signify a proactive stance by the industry and regulators alike to ensure the responsible and secure growth of the cryptocurrency market in the UK.