Cryptocurrency exchange Coinbase has secured registration as a Virtual Asset Service Provider (VASP) from the U.K. Financial Conduct Authority (FCA), the regulator confirmed this week. The approval enables the U.S.-based platform to legally offer crypto and traditional currency services in the U.K., one of its largest markets outside the United States.
The FCA’s registration, mandated under the U.K.’s anti-money laundering regulations, allows Coinbase to operate as a licensed crypto-asset firm. Public records show the exchange is now the largest registered digital asset service provider in the country.
Regulatory Context
The approval comes amid ongoing efforts by British authorities to finalize rules for the cryptocurrency sector. The U.K. government has prioritized creating a regulatory framework to attract fintech innovation while addressing risks like fraud and market instability.
Moreover, Coinbase, which entered the U.K. market in 2015, said the registration aligns with its compliance-focused expansion strategy. A company spokesperson noted the approval would help “responsibly grow services” in the region.
Market Implications
The FCA has approved fewer than 50 crypto firms under its VASP regime since 2020, with rejections tied to insufficient anti-fraud safeguards. Registered competitors include Bitstamp and Gemini. Analysts say Coinbase’s license strengthens its foothold in a market where major banks, such as Barclays and Standard Chartered, are increasingly exploring blockchain-based payment systems.
The U.K. move mirrors regulatory shifts worldwide. The European Union recently enacted its Markets in Crypto-Assets (MiCA) framework, while U.S. agencies have intensified enforcement against crypto firms. Meanwhile, the Bank of England is researching a central bank digital currency (CBDC), dubbed the “digital pound,” as part of a broader push toward modernizing financial infrastructure.
Coinbase’s registration underscores the U.K.’s balancing act between fostering innovation and mitigating risks in the volatile crypto sector. The government has positioned the industry as a potential driver of economic growth, citing job creation and investment opportunities.