Payments giant PayPal has successfully registered with the UK’s Financial Conduct Authority (FCA) as a crypto service provider, according to the regulator’s public register. However, PayPal faces restrictions on UK crypto services pending further FCA approvals.
The FCA register shows PayPal UK Limited was approved for registration on October 31, 2023. The status permits PayPal to engage in “certain cryptoasset activities” under the FCA’s anti-money laundering rules.
Registration also enables PayPal to approve its own UK crypto promotions after pausing purchases in August to comply with new marketing regulations.
However, a notice on the FCA website states PayPal UK remains subject to restrictions until explicitly granted further permissions:
- No onboarding for new UK crypto customers
- Existing clients can only hold or sell crypto, not buy
- Prohibited from expanding crypto services
Other barred activities per the FCA include:
- Enabling peer-to-peer transactions
- Participating in initial coin offerings
- Providing staking or decentralized finance services like lending
- Operating automated crypto-fiat exchange machines
PayPal paused UK users’ ability to buy crypto in August
Additionally, PayPal paused UK users’ ability to buy crypto assets starting in August 2023 due to the FCA’s recently imposed regulations. This restriction will remain in effect until 2024.
The limited registration comes as the UK Treasury released its final crypto asset regulation proposals this week. The framework would formally regulate several crypto activities for the first time.
The FCA registration allows the firm to continue providing crypto services to existing UK customers under tightened restrictions for now. Further permissions will likely be required to fully restore functionalities like new user onboarding and purchases.
Like other crypto firms operational in the UK, the payments giant must demonstrate to regulators its ability to comply with complex anti-money laundering regulations applied to the crypto industry.