UK regulators fine Coinbase $4.5 million, grant Revolut banking license News ▸ UK ▸ Regulation
UK regulators fine Coinbase $4.5 million, grant Revolut banking license
The regulatory actions were meant to protect crypto users in the country.
2 min read
Updated: Jul. 25, 2024 at 3:26 pm UTC
Cover art/illustration via CryptoSlate. Image includes combined content which may include AI-generated content.
Two crypto companies, Coinbase and Revolut, suffered contrasting fortunes in the hands of the UK authorities during the past week.
Coinbase fined
The UK’s Financial Conduct Authority (FCA) fined CB Payments Limited (CBPL), a subsidiary of Coinbase Group, £3.5 million ($4.5 million) for breaches related to Anti-Money Laundering.
In a July 23 notice, the FCA explained that the fine resulted from CBPL’s repeated violations of its guidelines. Initially, the fine was £5 million, but due to a settlement discount, it was reduced by 30% to £3.5 million.
In October 2020, the CBPL agreed to strengthen its financial crime control policies following a regulatory visit. This agreement included a commitment to not accept new high-risk customers without adhering to FCA guidance.
However, the FCA found that CBPL continued to onboard and serve 13,416 high-risk customers. Approximately 31% of these customers deposited nearly $24.9 million on the platform, which was then used on other Coinbase platforms for crypto transactions totaling $226 million.
Consequently, the FCA determined that CBPL failed to comply with the recommended controls. The regulator stated:
“The failings significantly increased the risk that financial crime might be facilitated by the Firm at a time when the Authority had informed CBPL that its systems and controls were not fully effective and required remediation.”
Revolut licensed
On July 25, Revolut announced it received a restricted banking license from the UK’s Prudential Regulation Authority (PRA), which oversees the banking sector.
The license comes more than three years after Revolut first applied in 2021 and initially places the firm in the mobilization stage. Francesca Carlesi, UK CEO of Revolut, said:
“It is a tremendous responsibility to be a bank in the UK and we will work relentlessly to offer products and services that improve the financial lives of everyone who uses Revolut.”
Revolut is a challenger bank that has made significant strides in the crypto industry. In May, the firm launched Revolut X, a standalone crypto exchange designed for retail customers.
Notably, the company recently published its financial accounts for last year, showing that its revenues surpassed $2 billion and recorded profits before tax of $545 million.
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Oluwapelumi values Bitcoin's potential. He imparts insights on a range of topics like DeFi, hacks, mining and culture, underlining transformative power.
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Coinbase
Coinbase is a digital currency exchange and wallet service that allows individuals to buy, sell, and store digital currencies, such as Bitcoin, Ethereum, and Litecoin.
Revolut
Revolut is a financial technology company that offers a range of financial services, including a digital banking platform, foreign currency exchange, stock trading, cryptocurrency trading, and other related services.