The FCA’s Crackdown on Crypto ATMs

The Financial Conduct Authority (FCA) in the United Kingdom is stepping up its game against unregistered cryptocurrency automated teller machines (ATMs). Recently, they teamed up with the cyber unit of West Yorkshire Police to take action against multiple sites in Leeds suspected of operating these illegal machines. Mark Steward, the FCA’s executive director of enforcement, made it crystal clear: if you’re operating a crypto ATM without FCA registration, you might as well be running a lemonade stand in winter—it’s just not going to end well.

Why All the Fuss?

As it turns out, having an unregistered crypto ATM in the UK is akin to selling fireworks during a fire ban—just a really bad idea. The FCA has emphasized that any crypto exchange provider must be registered to meet U.K. money laundering regulations. According to Steward, operating without that stamp of approval? Illegal.

What’s at Stake?

Let’s address the elephant in the room: crypto is known for its volatility and being a potentially high-risk investment. Mark Steward didn’t hold back, warning prospective investors that they should be prepared to lose all their money. Talk about a pick-your-poison scenario! If that doesn’t raise a few eyebrows, what will?

Local Enforcement’s Intervention

Detective Sergeant Lindsey Brants of the West Yorkshire Police has rolled out warning letters to operators of Bitcoin ATMs, asking them to cease and desist or risk an investigation based on money laundering regulations. One can only imagine how many panicked phone calls are coming into the various ATMs across Leeds right now—“Do you think we can just camouflage ourselves as regular ATMs?” Spoiler alert: Nope.

Statistics That Will Make You Sit Up

According to Coin ATM Radar, there are a staggering 28 known locations serving as Bitcoin ATMs in the UK. More than half of these are in London, with others sprouting up near Birmingham, Manchester, and Nottingham. So, it’s not just the local coffee shops getting shut down; the crypto ATM business is in hot water too!

A History of Attempts to Regulate

This recent crackdown isn’t the FCA’s first dance with unregistered ATMs. Back in March 2022, they issued statements urging operators to “shut down or face further action.” Spoiler alert: not much changed, and the FCA is back at it with renewed vigor. Currently, they’ve only granted registration to a modest 41 crypto companies, including popular platforms. So, if you’ve got your eye on the crypto prize, make sure you’re dealing with a licensed operator!