- August 17, 2023
- Posted by: [email protected]
- Category:
PayPal, the cryptocurrency-friendly payments platform, has announced temporary changes to its services in the United Kingdom due to regulatory compliance requirements. Starting October 1, 2023, PayPal’s U.K. customers will be unable to purchase cryptocurrencies like Bitcoin on the platform. This move is in response to new financial regulations enacted by the U.K. Financial Conduct Authority (FCA) and is expected to last until early 2024.
PayPal emphasised in an email to select U.K. customers that, while crypto purchases will be temporarily halted, consumers who already hold cryptocurrency on the platform can continue to do so without incurring any fees. Furthermore, they will be able to sell their crypto holdings at any time.
The decision to pause cryptocurrency purchases is a direct response to the U.K. FCA’s new regulations, which mandate additional steps for crypto firms to follow before allowing clients to buy cryptocurrencies. PayPal’s announcement emphasized that these measures are being taken to ensure compliance with the evolving regulatory landscape.
This temporary suspension comes after PayPal’s recent introduction of its own stablecoin, PayPal USD (PYUSD), and the launch of a cryptocurrency hub feature on its platform. The company has been steadily establishing itself as a crypto-friendly platform, having initially introduced cryptocurrency services in the United States in late 2020.
The development coincides with the U.K. government’s preparation to fully enforce the “Travel Rule,” a set of regulations developed by the Financial Action Task Force (FATF) that focuses on Know-Your-Customer (KYC) and Anti-Money Laundering (AML) measures for the crypto industry. Starting September 1, 2023, all crypto firms registered with the FCA will need to comply with the Travel Rule, as per the government’s instructions.
In addition to the Travel Rule enforcement, the FCA also recently announced that all crypto asset firms must ensure their marketing strategies are in compliance with the financial promotion regime in the U.K. by October 2023. These regulatory actions underscore the evolving landscape for cryptocurrencies in the United Kingdom.
