Binance: Leeds firm restricted by FCA from approving cryptoasset financial promotions

The FCA did not name Binance but did issue guidance for consumers who have invested with “an unregistered cryptoasset firm who has had its financial promotions approved by rebuildingsociety.com”.

It had previously been announced that rebuildingsociety.com was working with cryptocurrency exchange Binance.

The company’s managing director Daniel Rajkumar told The Yorkshire Post it has appealed to the courts against the decision.

He said on Wednesday: “So far, we have only approved financial promotions for Binance.

“We are working to produce evidence to show the FCA that the firm has the requisite skills and competencies, however this is difficult because unlike with professional advisors there are no set training standards or industry qualifications.

"We have appealed on grounds of proportionality and hope to hear back from a judge later today.”

A Binance spokesperson told Reuters that the firm had put "an enormous amount of time and resources" into meeting FCA requirements.

A blog post on the rebuildingsociety.com website said: “We have gone above and beyond the requirements to protect consumers in respect of its service to approve financial promotions for cryptoasset firms.

“After 10 years of managing high-risk investments, our experience prepares us to help others.”

It said the FCA should be working with companies such as itself to ensure 146 companies it says are not compliant with regulations can become so.

The restrictions stipulate that rebuildingsociety.com must not approve the content of any financial promotion for a qualifying cryptoasset and must withdraw any existing approvals. It must also notify affected clients about the restrictions.

The FCA said: “The financial promotions regime is designed to protect consumers from misleading and harmful promotions.

"Unregistered cryptoasset firms can only legally communicate financial promotions to UK consumers if those promotions are approved by an authorised firm.

“If unregistered cryptoasset firms’ promotions cease to be approved by an authorised firm, they must cease promoting cryptoassets to UK consumers until such time as they can find an authorised firm to approve their financial promotions.

“Consumers who have invested with an unregistered cryptoasset firm who has had its promotions approved by rebuildingsociety.com Ltd should still be allowed to receive communications about their existing assets that will allow them to withdraw, transfer or sell their existing assets.

“However consumers will not be able to receive promotions from unregistered cryptoasset firms related to further investment activity.”

The company’s website has a ‘Cryptoasset Financial Promotion Approval Service’ which states the firm “can guide you through the complex requirements for promoting cryptoassets to UK consumers”.

It states that there is a five-step process involving an initial £5,000 fee.