Copper Technologies has withdrawn its UK FCA registration application to focus on international expansion under new CEO Amar Kuchinad.
On December 20, popular cryptocurrency custodian and infrastructure provider Copper Technologies Ltd. reportedly withdrew its application to register with the UK’s Financial Conduct Authority (FCA). This comes as the company plans to shift its focus towards expanding operations in international hubs under the leadership of its new CEO, Amar Kuchinad.
Copper, chaired by former UK Chancellor of the Exchequer Philip Hammond, had been a leading crypto business in the UK since its founding in 2018. However, despite holding temporary registration with the FCA, the company failed to secure full regulatory approval under the agency’s updated crypto asset business framework. While it maintained services to UK clients via its base in Zug, Switzerland, the inability to meet FCA standards ultimately prompted this withdrawal.
The FCA’s rigorous requirements have proven to be a major hurdle for many crypto firms. As of September 2024, nearly 90% of applicants failed to meet its standards, with only four out of 35 applications approved in the past year. The challenging regulatory environment has led not only Copper but also industry giants like Binance to withdraw their applications.
Shifting Priorities
Faced with these regulatory roadblocks, Copper has been steadily refocusing its efforts on jurisdictions with more favorable frameworks. The company has prioritized obtaining licenses in Europe, Hong Kong, and Abu Dhabi. In October, while welcoming Kuchinad as the new CEO, Hammond hinted at the company’s plan for global growth. “I am confident that we now have the team in place to deliver the next stage of Copper’s global growth story,” he stated at the time.
It is interesting to note that Copper has already made headway in Europe. The company operates as a trusted crypto custodian in Switzerland with the Swiss Financial Services Standards Association (VQF) and the Financial Market Supervisory Authority (FINMA). Moreover, Copper also holds a regulatory license with Abu Dhabi’s Financial Services Regulatory Authority (FSRA) to offer custody services for tokenized money market funds in the region.
Stringent Scrutiny in UK’s Crypto Sector
The United Kingdom remains a critical player in the global cryptocurrency economy, ranking as the largest market in Central, Northern, and Western Europe (CNWE) and second worldwide in raw transaction volume, according to a 2023 Chainalysis report.
However, the stringent regulatory environment poses challenges for firms seeking to operate within the country. The UK government is working to integrate cryptocurrencies into its financial services framework through the Financial Services and Markets Bill. This has resulted in tough regulatory requirements for crypto businesses, leading them to re-evaluate their options.
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