Casey Wagner

Crypto companies with US operations — including Wirex and B2C2 — withdrew their applications to register with a United Kingdom financial watchdog in recent months after the standards for acceptance were raised.&nbsp;



The vast majority of crypto firms that have attempted to register with the UK’s Financial Conduct Authority (FCA) have been denied, the agency <a href="https://www.fca.org.uk/cryptoassets-aml-ctf-regime/feedback-good-poor-quality-applications#section-who-this-is-for" target="_blank" rel="noreferrer noopener">reported</a> this week. There are now 41 companies listed on the FCA’s cryptoasset firm registry, according to the <a href="https://register.fca.org.uk/s/search?predefined=CA" target="_blank" rel="noreferrer noopener">agency</a> — or about 15% of applicants. 



An FCA executive, Sarah Pritchard, in a <a href="https://committees.parliament.uk/publications/33650/documents/183917/default/" target="_blank" rel="noreferrer noopener">letter</a> earlier this month said 85% of the firms vying for the regulator’s approval “were unable to demonstrate they met the required, minimum standards.”



Added Pritchard: “As part of the registration process we identified significant failures in relation to key controls such as customer due diligence, risk assessments, transaction and ongoing monitoring [and] governance.”&nbsp;



Representatives for Wirex, a crypto payments platform, and B2C2, a digital assets liquidity provider, did not immediately return requests for comment.&nbsp;



The FCA also had doubts that the people leading some of the denied crypto firms lacked the experience and knowledge needed to effectively and safely run the business.&nbsp;



&#8220;It is difficult to judge whether leading personnel in firms ‘lack appropriate knowledge, skills and experience’ when it is judged against a lack of transparency and an absence of benchmarks and guidance from the FCA,” said Alexander Carter-Silk, cryptocurrency solicitor at Keystone Law. “There is no clear explanation as to what is applicable to crypto asset businesses, possibly because the FCA is fearful of the new technology.”&nbsp;



Earlier this year, the UK set a deadline that any crypto entity hoping to conduct business in the country had to register with the FCA by April 2022.&nbsp;



By March, just 27 of the 100-plus companies under consideration had been approved. A total of 58 firms withdrew or were denied by March 15 of the same year, the regulator said, and a “small number” of companies were found to be allegedly involved in criminal activities, the FCA said.&nbsp;



Wintermute Trading, Galaxy Digital’s UK branch and Fidelity Digital Assets are among the firms that were able to make the cut.&nbsp;



In the US, states have some control over which crypto services can be offered by which companies. For example, New York’s BitLicense law has prevented several companies from conducting business in the state, including Binance.US and Kraken.&nbsp;



Companies hoping to operate in the UK have expressed frustration with the current system, which some leaders say puts too much emphasis on scrutinizing individual firms versus creating a set of standards.&nbsp;



“Former chancellor Philip Hammond has declared that the UK needs to take measured risk in order for the UK to excel as a leader in cryptocurrencies, but for that the community needs measurements to abide by,” said Katharine Wooller, business unit director at digital asset protection firm Coincover.



“If we want to get ahead as a global leader in digital assets, we need to stop assessing firms, and start working with them to develop a regulatory framework.”



<hr class="wp-block-separator">
Get the day’s top crypto news and insights delivered to your email every evening.&nbsp;<a href="https://cms.blockworks.co/newsletter/?source=end" target="_blank" rel="noreferrer noopener">Subscribe to Blockworks’ free newsletter</a>&nbsp;now.
 
Want alpha sent directly to your inbox? Get degen trade ideas, governance updates, token performance, can’t-miss tweets and more from&nbsp;<a href="https://blockworks.co/newsletter/research" target="_blank" rel="noreferrer noopener">Blockworks Research&#8217;s Daily Debrief</a>.
 
Can&#8217;t wait? Get our news the fastest way possible.&nbsp;<a href="https://t.me/blockworks_news" target="_blank" rel="noreferrer noopener">Join us on Telegram</a> and follow us on <a href="https://news.google.com/publications/CAAqBwgKMPyTxgswn6_dAw" target="_blank" rel="noreferrer noopener">Google News</a>.
<hr class="wp-block-separator">

UK Denies Crypto Companies the US Lets Operate 

Macauley Peterson

<div id="highlights-block_61d6e48a83669" class="highlights">
 <ul>
 <li>XSGD was chosen as Wirex&#8217;s first APAC-based stablecoin</li>
 <li>Wirex users will be able to spend XSGD via the Wirex card</li>
 </ul>
 
</div>



The Singapore dollar-backed stablecoin XSGD now has a market capitalization of about $206 million US dollars, <a href="https://www.coingecko.com/en/coins/xsgd" target="_blank" rel="noreferrer noopener">as tracked by Coingecko</a>, amid a total stablecoin market approaching $170 billion. That’s just 0.1% of the total stablecoin market, and yet it makes XSGD the third largest non-USD currency in the <a href="https://www.coingecko.com/en/categories/stablecoins" target="_blank" rel="noreferrer noopener">stablecoin category</a>, after the euro.



The three leading euro stablecoins Euro Tether, Stasis Euro, and sEUR (from Synthetix) collectively register about $411 million.



The US dollar shows little sign of relinquishing its dominance any time soon, however StraitsX co-founder <a href="https://cms.blockworks.co/a-majority-of-stablecoins-will-be-non-usd-says-straitsx-founder/" target="_blank" rel="noreferrer noopener">predicted in October</a> that a majority of stablecoins will eventually be non-USD denominated.



Ease of on-boarding into stablecoins remains the chief barrier to adoption and that’s what the latest announcement from Wirex, a worldwide digital payment platform created in 2014, seeks to address.



The London-based firm developed the world&#8217;s first crypto-enabled payment card in 2015, allowing users to spend crypto alongside traditional currencies, and now sports around 4.5 million customers in 130 countries, according to the company.



“It&#8217;s vital to offer a wide variety of tokens to suit all users, regardless of their lifestyle and experience with crypto,” said Wirex co-founder and CEO Pavel Matveev in a statement on Thursday, noting that stablecoins are key to attracting new users who seek to avoid the rampant volatility of other digital assets.



Wirex first supported stablecoin was MakerDAO’s DAI back in 2019, but newly available on the platform are True (TUSD), USD Coin, (USDC), Tether (USDT), Paxos&#8217; USDP, Stasis Euro (EURS) and XSGD, with the caveat that only some stablecoins are available in certain regions.



StraitX introduced <a href="https://cms.blockworks.co/straitsx-launches-indonesia-rupiah-stablecoin/" target="_blank" rel="noreferrer noopener">an Indonesian Rupiah-backed stablecoin</a> in November, and it’s sister company FinTech Xfers is licensed by the Monetary Authority of <a href="https://cms.blockworks.co/?s=singapore" target="_blank" rel="noreferrer noopener">Singapore</a> for e-money issuance.



Aymeric Salley, Head of StraitsX, sees a bright future for 11 ASEAN group of countries in Southeast Asia, and said in a statement, “we&#8217;re delighted to see Wirex pioneering this effort with XSGD now being supported by the Wirex platform. We look forward to users being able to spend XSGD via the Wirex card.&#8221;



<hr class="wp-block-separator"/>
Get the day’s top crypto news and insights delivered to your inbox every evening.&nbsp;<a href="https://cms.blockworks.co/newsletter/?source=end" target="_blank" rel="noreferrer noopener">Subscribe to Blockworks’ free newsletter</a>&nbsp;now.
<hr class="wp-block-separator"/>