FCA Announces Extension of Temporary Registration Regime for Cryptoasset Firms

The United Kingdom's Financial Conduct Authority (FCA) announced to extend the end date of the Temporary Registrations Regime (TRR) for existing cryptoasset businesses from 9 July 2021 to 31 March 2022.

Established last year, the TRR allows existing cryptoasset firms, which applied for registration before 16 December 2020, and whose applications are still being assessed, to continue trading.

According to the watchdog, a significantly high number of businesses are not meeting the required standards under the Money Laundering Regulations resulting in an unprecedented number of businesses withdrawing their applications. The extended date allows cryptoasset firms to continue to carry on business whilst the FCA continues with the robust assessment being undertaken.

FCA stated that it does not have consumer protection powers for the cryptoasset activities of firms. Even if a firm is registered with the FCA, it is not responsible for ensuring cryptoasset businesses protect client assets (ie customers’ money), among other things.

Back to October 2020, the UK regulator published final rules banning the sale of derivatives and exchange traded notes (ETNs) that reference certain types of cryptoassets to retails consumers. The ban has come into effect on 6 January 2021.