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The UK Financial Conduct Authority (FCA) annual report for 2023/24 highlighted that over 87% of crypto registrations were withdrawn, rejected, or refused for weak money laundering controls.

According to the FCA, the UK regulator has been communicating with firms to ensure they followed the guidelines and met the expectation of “good and poor practice” in combatting money laundering. So far, 44 crypto firms have money laundering registration. 

Ever since its establishment on Jan. 10, 2020, FAC has been acting as the anti-money laundering and counter-terrorist financing (AML/CTF) supervisor of UK crypto firms and has registered 47 firms till Sept. 1, 2024.

Meanwhile, out of the total 31 crypto firms' applications, 48% of crypto firms have withdrawn their applications, and 29% of crypto firms were rejected during the financial year 2023 to 2024.

Apart from ensuring the firms' AML methods are strong, the UK FCA has also made guidelines to ensure crypto companies’ financial promotion is “clear, fair, and not misleading.” 

The report mentioned that consumers benefit from a new 24-hour cooling-off period from promotions and has issued 450 consumer alerts against firms illegally promoting crypto assets in the first three months of the rules going live. 

Investors also have become vigilant in the UK as the report claimed that 63% of consumers have called the FCA about potential scams in 2023 before investing, which is up from 58% the year before.

With the rise of cryptocurrency, scammers have been implementing on-chain and off-chain tactics for money laundering activities. According to a Chainalysis report, illicit addresses transformed $22.2 billion worth of cryptocurrency in 2023, which is a decrease compared to the  $31.5 billion in 2022. 

Read more: 43% of 2024 crypto scam inflows linked to pig butchering: Chainalysis