CEX.IO Resumes UK Operations After Compliance
crypto exchange CEX.IO has resumed operations in the UK after successfully complying with the Financial Conduct Authority’s (FCA) regulations. The company voluntarily paused its UK services following the introduction of new crypto asset financial promotion regulations by the FCA in October 2023. The UK had been a significant market for CEX.IO before the suspension, with 69% of its European Economic Area customers based in the country, the exchange said in a press release shared with CryptoNews.
CEX.IO Offers Access to 190 Digital Assets
The exchange currently offers access to 190 digital assets to its UK users. “We aim to strengthen our presence in the U.K. by aligning with new regulatory standards and supporting the region’s growth as a hub for the cryptocurrency market,” Rich Evans, Managing Director of CEX.IO UK, said. He also highlighted CEX.IO’s strong security measures and its clean record with regulators over its 11-year history.
According to Evans, prioritizing legal compliance and customer trust has always been at the forefront of the company’s business model, even at the cost of short-term growth. Although CEX.IO is still in the process of obtaining full Anti-Money Laundering (AML) registration with the FCA, the exchange was able to return to the UK market through a partnership with Gateway 21, an FCA-authorized financial promotion approver.
CEX.IO’s services are currently provided from Lithuania, a strategy increasingly adopted by crypto companies to navigate the UK’s regulatory environment. For example, crypto lender Nexo recently resumed UK operations through a similar arrangement with Gateway 21.
As part of the compliance process, UK-based crypto firms must implement measures like cool-off periods and risk warnings tailored specifically for UK clients. Additionally, users are required to complete investor categorization questionnaires and undergo assessments to ensure the appropriateness of their investment decisions. These steps have become standard practice for crypto companies operating in the UK under the new regulatory regime.
CEX.IO Started as bitcoin Mining Pool
CEX.IO’s origins trace back to 2013 when it launched as the GHash.IO mining pool. The pool connected miners who collectively produced over 583,000 Bitcoins before ceasing operations. At its peak, GHash.IO controlled nearly 51% of bitcoin’s hash rate, raising concerns in the crypto community about the risk of a “51% attack,” which could theoretically allow the pool to manipulate transactions. To avoid this, several miners left the pool, and GHash.IO eventually closed its doors.
The FCA’s new rules for crypto asset financial promotions, which took effect in October 2023, were aimed at improving the transparency of marketing in the sector. Since its implementation, the FCA has issued over 450 alerts related to illegal promotions. The regulator has been stringent in enforcing these rules, warning that even social media posts, such as crypto memes, could violate the guidelines.
crypto exchanges, including Coinbase and binance, have responded by modifying their services for UK users to avoid non-compliance. The new regulatory framework has proven challenging for many companies, with some choosing to exit the UK market entirely. However, several major exchanges, including Coinbase, OKX, and binance, have partnered with third-party firms authorized by the FCA to continue operating within the UK.
