Ashley Alder, the incoming chair of the UK’s Financial Conduct Authority (FCA), believes crypto firms are “deliberately evasive” and facilitate money laundering, asking for more regulations.
During a virtual meeting, Alder told UK Treasury members on Wednesday that many crypto platforms are “deliberately evasive,” facilitate money laundering and create “massively untoward risk,” according to a report from Financial Times.
Alder currently spearheads Hong Kong’s Securities & Futures Commission and is expected to become FCA chair in February. His most recent comments suggest that crypto companies hoping to build businesses in the UK will face an uphill battle.
“Our experience to date of [crypto] platforms, whether FTX or others, is that they are deliberately evasive, they are a method by which money laundering happens in size,” he reportedly said, adding that the way crypto firms “bundle a whole set of activities which are normally segregated . . . gives rise to massively untoward risk” such as conflict of interest.
“I think it [crypto] should be regulated further,” he said.
The FCA is a financial regulatory body in the United Kingdom, tasked with regulating the financial services industry in order to protect consumers, keep the industry stable, and promote healthy competition between financial service providers.
The watchdog has traditionally taken a harsh stance on crypto companies, rejecting 80% of crypto firms applying to join the watchdog’s register of businesses that have passed its anti-money laundering checks.
Meanwhile, the British government is finalizing plans to give the watchdog broader powers to regulate the crypto markets, including overseeing crypto firms’ advertising, sales practices, and management, monitoring how companies operate, restricting companies selling from abroad into the U.K. market, and more.
The move came following the unprecedented collapse of FTX, once the third-largest cryptocurrency exchange that failed in early November and delivered billions of dollars in losses to retail clients.
Sam Bankman-Fried, the disgraced founder of the exchange, was arrested by the government of The Bahamas on Monday after US prosecutors formally filed criminal charges against him. The Southern District of New York, the Department of Justice, and the SEC have indicted SBF on various criminal charges.
As reported, Senator Elizabeth Warren has teamed up with Republican Senator Roger Marshall of Kansas to introduce a bipartisan bill that aims to crack down on money laundering loopholes in the crypto industry. Separately, the G20 countries plan to create a policy consensus on cryptocurrencies in a bid to better regulate the asset class.