The UK Financial Conduct Authority (FCA) warns against Poloniex
The Financial Conduct Authority (FCA) in the United Kingdom has added cryptocurrency exchange Poloniex to its list of non-authorized companies. This comes after the exchange, which is owned by entrepreneur Justin Sun, suffered four hacks in the past two months. The FCA’s warning states that firms and individuals cannot promote financial services in the UK without proper authorization or approval. The regulator also reminds the public that dealing with unauthorized entities means they are not protected by financial laws.
FCA’s strict approval process for crypto companies
The FCA revealed that it has received 291 applications from crypto companies seeking registration since 2020, but only 38 have been approved. In October, the regulator included 140 crypto companies, including HTX and KuCoin, on its warning list. Only one entity, PayPal UK, has been authorized since then.
Poloniex’s recovery efforts after a $100 million hack
Poloniex was targeted in a $100 million hack on November 10. The platform has reported that it has mostly completed its restoration efforts and was preparing to resume withdrawals and deposits by the end of November. On December 5, the company resumed deposit and withdrawal services for specific cryptocurrencies via the Tron network.
Justin Sun’s other platforms also hacked
In addition to Poloniex, Justin Sun’s other platforms have also experienced hacks recently. HTX lost $8 million in September and $30 million in late November due to a hot wallet breach. Hackers also compromised HTX’s HECO Chain bridge, resulting in at least $86.6 million being sent to suspicious addresses.
Hot Take: FCA warns against unregulated exchanges
The FCA’s warning against Poloniex highlights the importance of dealing with authorized entities in the cryptocurrency industry. With the increasing number of hacks and security breaches, it is crucial for crypto users to ensure they are using trusted and regulated platforms. The FCA’s strict approval process serves as a reminder that not all crypto companies meet the necessary criteria for operating legally. It is advisable for individuals to conduct thorough research and exercise caution when engaging with cryptocurrency exchanges and services.
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