Revolut Pauses UK Crypto Services Ahead of Tighter FCA Rules

Digital banking app Revolut is hitting pause on cryptocurrency purchases for business customers in the U.K. starting January 3rd. The move comes as the UK gears up for stricter crypto regulations set to take effect in early 2024.

In an email seen by City A.M., Revolut indicated that tighter Financial Conduct Authority (FCA) requirements around cryptocurrencies necessitated changes to its offerings. Business accounts will still be able to hold and sell cryptocurrency through the app. However, retail users are unaffected for now.

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UK’s FCA to introduce robust rules

The incoming rules aim to boost consumer protections as crypto adoption widens in the U.K. Key measures include banning incentives for promoting crypto assets as well as requiring 24-hour “cooling off” periods before some crypto transactions can occur.

“These requirements aim to enhance the customer journey and provide additional protection for new and existing investors in crypto assets.” “As a result, we’ll need to adjust our current business crypto offering to make sure all of the new requirements are met,” the firm said in the email.

Revolut and many other crypto-associated companies have tried to overhaul systems and account offerings to comply with the FCA policies taking effect on January 8th. Some firms see the regulatory overhaul as overly stringent and better suited to traditional investments. In addition, they argue the rules will dampen crypto innovation and growth in the U.K.

Nonetheless, regulators continue pushing the measures as necessary to avoid misleading claims and rash investments from consumers dipping into the notoriously volatile crypto space.

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Reactions across crypto-exposed businesses have been almost similar, with companies like PayPal withdrawing U.K. crypto services entirely for now rather than make deep technical adjustments under a tight deadline.

For Revolut and its clients, this week’s selective feature rollback marks just one stop on the winding journey toward integrating crypto into mainstream finance.