OKX, a leading cryptocurrency exchange, is implementing new measures for its UK-based users. Thus, aligning with the regulations recently established by the country’s Financial Conduct Authority (FCA). From next week, OKX will require UK users to complete a detailed questionnaire, aimed at ensuring they fully understand the risks associated with buying and trading digital assets.
As part of the regulatory requirements, in addition to the first questionnaire, there will be a second, focused on assessing whether investing in cryptocurrencies is appropriate for the investor’s profile. OKX highlights that users who are unable to complete the questionnaires or demonstrate an adequate understanding of the risks will be ineligible to maintain an account on the platform.
Efforts to Comply with FCA Rules
OKX’s initiative follows the commitment of exchanges like Binance and OKX itself to adhere to the new FCA guidelines. The specifications will come into effect on January 8, 2024. In October 2023, Binance had already launched a new domain specifically for UK users. Thus, establishing a partnership with local peer-to-peer lending platform, Rebuildingsociety.
While Binance faced additional restrictions from the FCA regarding Rebuildingsociety, halting onboarding of new UK users in October, OKX took proactive steps to adapt to future regulations. Therefore, the exchange reduced its token offering to around 40 assets and implemented risk warnings on its interface.
Impact on the Cryptocurrency Market
With the motto “trading responsibly”, OKX seeks to align the cryptocurrency industry with the norms of traditional finance. The exchange emphasizes that all digital assets carry a certain degree of risk. Therefore, companies that offer them must make this clear to investors. A disclaimer has been added to the OKX website, warning users: “Do not invest unless you are prepared to lose all the money you invest. Cryptocurrency is a high-risk asset and you should not expect to be protected if something goes wrong.”
The FCA’s new rules and the adoption of measures by exchanges like OKX mark an important step in regulating the cryptocurrency sector in the UK. Therefore, this approach aims to increase investor awareness of the risks involved and promote safer and more responsible trading practices.
The views and opinions expressed by the author, or anyone mentioned in this article, are for informational purposes only and do not constitute financial, investment or other advice. Investing in or trading cryptocurrencies carries a risk of financial loss.