But what is this crypto list, and what does it mean for people looking to try out digital currencies at established crypto firms?

The Crypto Assets List

The list is a full breakdown of every known crypto company that can offer crypto services in the UK, both registered and unregistered. It acts as a crypto register, listing each crypto exchange business operating in the country.

What is registration?

As of 2022, crypto asset activities can be monitored to prevent money laundering and assist with counter-terrorism. Cryptoasset firms need to be compliant with the Money Laundering Regulations (MLRs) and register with the FCA.

Businesses that are not registered are not firms permitted to offer crypto services to the UK public. They are considered to be operating illegally and going against the laws of the UK government.

Why does this matter?

The government has restrictions in place for anti-money laundering efforts and other safety or quality checks, but crypto firms occasionally decide to operate in the UK without authority. An unregistered firm is not only illegal but is most likely not following relevant laws that protect investors.

Investing in illegal and unregistered firms puts you at serious risk of having a payment taken, money withheld, accounts stolen, and personal details used against you.

Why is this bad?

These companies are not showing compliance with relevant FCA laws, which means that they will often use scams or malicious tactics to earn money.

By working with an unregistered crypto exchange firm, you are effectively working with criminals. They can promise high returns and bonus funds if you invest, only to take any cash, bitcoin, or other crypto you have and steal your investment the moment you pay them.

How to check if a crypto exchange is regulated?

You can see if a firm is registered using the Financial Services Register, a list of all businesses with full approval.

Each business on this list has gone through the entire process and is now a low-risk option that can legally continue trading.

Remember that approved businesses can still have risks. Being registered means that the business can operate on the crypto market, but firms could take payments and refuse to give investors their money back. Anything like this would get them removed from the register and investigated.

The register is more of a monitoring list, showing which businesses have been checked as part of anti-money laundering practices. Choosing to buy and sell bitcoin or other cryptocurrencies there is a safer option than using an unregistered firm.

Temporary Registration

A company is placed on the temporary registration list while applying for registration with the FCA. This temporary list is essentially a trial run, and a firm can be removed from both the temporary registration list and the FCA registration as a whole if they fail.

This means that firms can still trade and take on investors while they apply for registration. Temporary status is basically a review status - some firms can still be high-risk since they have not actually undergone full approval yet.

Unregistered Firms

The FCA also maintains a list of unregistered firms that are operating without authority.

These are groups that have yet to apply for registration, either because they are waiting for another deadline or because they are knowingly operating illegally.

You should not work with these businesses – they are part of a market that has not received approval from the FCA or HM Treasury, and any payment or investment you make could be lost if the company decides to steal it.

These companies can be dangerous. You will not have access to the Financial Ombudsman Service or Financial Services Compensation Scheme, along with any direct legal support, unless something major goes wrong.

Finding your firms

If you want to review your firms on the list, be sure to check all three of them. Companies that are registered or temporarily registered are a safer bet, whereas going with a company that has not even applied can carry numerous risks.

There is no value in working with an unregistered company.

Even if they carry bitcoin and the other currencies you are interested in trading, whether or not they take your cash depends on how they decide to treat you. They are unregulated and can simply take your bitcoin or other currencies without warning.

The Financial Conduct Authority's list of firms makes it easy to check if certain companies are registered or not.

Remember that this list consists of only known companies and firms within the country - if you find a little-known UK company offering crypto, it may not be known to the FCA yet.

Why are unregistered crypto firms dangerous?

The Financial Conduct Authority requires all firms like this to register. Companies that continued trading past the original end-of-March deadline for FCA registration are breaking the law, and their trading includes accepting payments from individual investors.

Since the end of March, multiple companies have remained unregistered.

They are not legally allowed to get involved with financing or trading like this, yet they still offer services, hoping to get money and investors through illegitimate methods.

Temporarily registered businesses like Copper Technologies have at least hit a deadline and attempted to approach the FCA, meaning that their trading strategy is likely fair.

Those avoiding the FCA March deadline should have closed but have continued to operate outside of the law.

Even if only five firms are on the unregistered list, that could be five firms that have skirted the registration process to continue scams and other illicit activities.

What happens if I find unregistered crypto services?

Alerting the FCA to unregistered UK firms is an option, but it is very important that you do not attempt to do business with them. Avoid giving them any money or crypto investments at all costs.

UK crypto firms are best when they are fully registered by the FCA, the main UK authority on crypto asset activities.