Binance under renewed scrutiny in the UK following a deal with EQONEX

The Financial Conduct Authority expressed concern about a strategic partnership that will see a Binance subsidiary advance a $36 million convertible loan to EQONEX.

UK flag and hammer

According to the FCA, the move could be interpreted as a transfer of “specific contractual rights” to Digivault, a child company of EQONEX that has full approval to conduct cryptoasset activities. Binance is not a registered cryptoasset firm, having withdrawn its application in May 2021.

The FCA warned it can “suspend or cancel” the registration of a cryptoasset business, and reiterated concerns about Binance Markets, a Binance subsidiary whose “limited” registration was further restricted in June 2021.

Binance CEO Changpeng Zhao addressed the issues surrounding the exchange’s status in the UK as he spoke to UK government officials, MPs and Lords over dinner last week, The Block reports. A spokesperson for Binance confirmed that the company was pursuing “every licence and registration” they could, suggesting that the company made a U-turn from their earlier strategy.