Luno digital asset exchange will halt service for some of its customers in the United Kingdom due to the country’s tough new laws, a new report has revealed.
In a statement, the exchange said that the new restrictions will take effect on October 8, just days before the new rules by the Financial Conduct Authority (FCA) kick in.
The statement by Luno’s head of public policy, Nick Taylor, noted that the new rules will impact the entire industry, and that the exchange wants to stay ahead of the curve.
“The FCA has implemented new rules for crypto firms. As a result, all compliant crypto firms with U.K. customers are making a number of changes to their platforms in order to comply with the new regulations. For Luno, this includes pausing the ability to invest through the platform for some customers for the time being,” Taylor stated.
The FCA introduced the new rules in June in a bid to protect investors and keep up with changing trends. They require all advertisements to include a disclaimer on the risk involved, including warning investors that they could lose all their money.
Newbie investors will also be unable to purchase digital assets immediately. VASPs must allow them 24 hours to rethink their decisions before they can make their first purchase.
Another significant change is the cancellation of incentives to attract new customers, including referral bonuses and airdrops. The FCA places this restriction on asset classes it considers highly risky.
FCA gave VASPs three months to get their houses in order. In August, however, the watchdog gave these companies the option of a three-month extension up until January next year.
Luno isn’t the first casualty of the upcoming rules. PayPal (NASDAQ: PYPL), which now offers a stablecoin, announced that it would suspend digital asset purchases for the rest of the year as it sets up its systems to comply with the new regulations.
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