Cryptocurrency News Today – according to reports, the FCA (Financial Conduct Authority), the apex regulatory agency in the UK has issued a stern warning to crypto projects particularly BitMEX. The regulator claims that BitMEX “has been engaging in regulated activities that require authorization.” These activities have been tagged as unauthorized hence, BitMEX is providing financial services without authorization.

BitMEX exchange and one of the biggest derivatives market for BTC have come under the regulator’s radar after the agency initiated a rule change in the United Kingdom on January 10, 2020. Additionally, as earlier reported on, the regulator has banned crypto derivatives in the UK. This move has created a scare in the digital currency market.

The FCA’s Warning Regarding BitMEX Exchange

The FCA has warned traders and investors about BitMEX exchange.

“If you chose to use an unauthorized company, you will not benefit from the Financial Services Compensation Scheme (FSCS). Meaning, you are unlikely going to get a refund if things go wrong.”

Hence, if you become a victim of fraud or there is evidence of unethical conduct from BitMEX exchange, traders will have no right to claim a refund under the new UK laws. Whether or not the Financial Conduct Authority will restrict BitMEX’s services within the UK, remains to be seen. The regulator’s warning excludes reimbursements and scams. Kraken was included in the list. However, the FCA confirmed it was a mistake to add Kraken. Because BitMEX is arguably one of the biggest derivatives exchanges in the UK market. Even though a government crack-down could harm the industry, it will provide an opportunity to create regulation or others to take full advantage of regulations.

Did the 2020 Rule Change Prompt BitMEX Warning?

According to reports, Bitcoin and other cryptos weren’t previously regulated in the UK because of laws in the country. However, the letter on the rule change published earlier in January notes that:

“Exchange tokens are not regulated in the UK currently. Meaning the transfer, and purchase as well as the sale of exchange tokens, currently fall outside the FCA’s regulatory remit.”

The FCA says it will supervise the ecosystem to avoid money laundering for terrorist financing. The regulator’s letter also adds that its’ regulatory powers don’t cover ‘how crypto businesses are been conducted in the country.’

Apparently the warning letter is calling for more stringent KYC/ALM compliance as well as the implementation of the travel rule for crypto users and traders. Users must now be careful regarding doing business with BitMEX exchange.