UK: Archax Becomes the First FCA-Regulated Digital Securities Platform


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Archax, a London-based company has become the first digital securities exchange and custodian to be regulated by the U.K. regulator, the Financial Conduct Authority (FCA).

Archax Obtains Various Licenses for the FCA

The company made the announcement via a press release on Wednesday (August 19, 2020). According to the press release, Archax is also the first company to receive a crypto asset registration from the FCA to be Virtual Asset Service Provider (VASP) compliant.

Following the announcement, digital issuance globally can trade on a secondary market licensed by the FCA. Also, the regulation gives the platform credibility as institutions will access a regulated trading venue offering digital securities. With a regulation by the U.K. regulatory watchdog as a small and medium-sized (SME) Growth Market, Archax can make it easier for SMEs to raise capital and also be a secondary market for trading. 

Also, the FCA license includes the Multilateral Trading Facility (MTF) permissions that will enable Archax to operate a digital securities marketplace in London. Furthermore, the company can act as a broker and also has permission to act as a custodian for cash and digital assets. 

Commenting on the recent development was Archax CEO Graham Rodford, who stated that although the process was rigorous, the company was excited to achieve this milestone. 

Rodford further said:

“Our technology partners are second to none, we have a pipeline of 35 digital issuances in place, and we are signing up global brokers and market makers ready for go-live. This is an exciting moment for Archax and a great step in the evolution and legitimacy of digital securities globally.”

FCA’s Active Role in the Crypto Industry

Apart from Archax, Kraken’s subsidiary Crypto Facilities obtained an MTF license from the U.K. regulatory watchdog back in July. With the license, Crypto Facilities became the first crypto derivatives platform in Europe with a trading license.

Apart from granting licenses, the FCA is strict about unregulated crypto operations in the country. Back in March, the regulatory agency declared that BitMex, a crypto exchange, and derivatives trading platform, was not licensed to operate in the U.K. 

Bitcoin Evolution and Kraken were also blacklisted by the FCA. However, Kraken stated that the U.K. regulatory body made an error. 

The FCA continues to play an active role in monitoring and regulating the crypto space. Earlier in 2020, the FCA released a new set of rules that would see crypto businesses operating in the country pay for application fees according to the size of their income.

In June, the FCA stated that businesses not registered with the regulatory body by January 2021 will cease operations in the country.

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