In a surprising turn of events, Luno, a prominent crypto exchange, has revealed plans to temporarily restrict UK customers from investing in crypto. The move, divulged by Nick Taylor, Head of Public Policy at Luno, will resonate from October 6th, conveniently around the time that the UK is slated to enforce new regulations on crypto promotion.
The Financial Conduct Authority (FCA) has concocted a fresh set of guidelines that crypto firms must adhere to henceforth. Luno is not alone in this pause of operations, as all compliant crypto companies dealing with UK clientele face a shake-up to align themselves with the new regulations.
This shift occurs under the backdrop of a move to treat cryptocurrencies akin to “restricted mass market investments”. The mandates entail that all promotions and adverts must ring with clear notices and incentives are to be flatly prohibited.
Luno’s decision to cease investment activities for some clients for an indefinite period is a direct upshot of these regulations, according to Taylor. Worryingly, an email shared with CoinDesk from a Luno investor revealed that they will no longer be able to purchase or trade in cryptocurrency from October 6th.
Nevertheless, the crypto exchange is letting their affected customers withdraw and sell their funds, as stated by Taylor. Reacting to the changes initiated by the FCA, the exchange has reiterated their commitment to a gradual approach towards reintroducing investment opportunities.
Interestingly, the new rules were to be enforced from October 8th, but companies now have the luxury to procure a grace period of three months to implement the guidelines.
The domino effect of the new regulations has also reached PayPal, which stated a halt in its crypto purchases in the same month and anticipates the halt to last until 2024.
While these developments are bound to cause disruption in the UK crypto scene, they also highlight the crypto industry’s resilience and adaptability as they attempt to comply with financial authorities’ mandates. This unfolding landscape could provide anxious investors with an interesting perspective on the intersection of regulatory normativity and the dynamic crypto world.
Source: Coindesk
