PayPal Secures FCA Approval for Crypto Services in UK Amid Post-Brexit Adaptation

• PayPal receives approval from the FCA to provide cryptocurrency services in the UK, registering for specific crypto activities from October 31, 2023.
• This strategic move aligns with PayPal’s post-Brexit plans, adapting to the changing regulatory landscape and the UK’s evolving crypto sector.

PayPal, a global payments giant, has received the green light from the Financial Conduct Authority (FCA) to provide cryptocurrency-related services in the United Kingdom. This approval, disclosed on the FCA’s website, reveals that PayPal registered for specific crypto activities in the UK starting October 31, 2023. The move is part of PayPal’s strategic adaptation to the post-Brexit operational landscape.

Regulatory standards set by the FCA demand robust measures to prevent the misuse of cryptocurrencies for illegal activities. This regulatory scrutiny comes amid the UK’s anticipation of establishing its first regulatory framework for the cryptocurrency sector. For PayPal, this approval is a pivotal step after it temporarily halted cryptocurrency purchases for its UK customers in October, complying with the evolving legislative environment in the UK.

Transition in Operations: Post-Brexit Adaptation for PayPal

Starting November 1, PayPal’s UK users will transition from PayPal Europe to a newly established entity within the UK. This shift is a direct consequence of the UK’s separation from the European Union, ensuring uninterrupted services for the UK market.

The approval gives PayPal the license to engage in specific crypto activities; however, certain limitations restrict its scope. The FCA’s register indicates that PayPal’s crypto services will be limited, including pausing onboarding new customers and determining existing ones to hold and sell functionalities. Services such as crypto exchange, ICO participation, staking, peer-to-peer exchange, and DeFi operations are excluded.

This approval places PayPal as the fourth entity to acquire such registration, aligning with Interactive Brokers, Bitstamp, and Komainu. The move not only strengthens PayPal’s foothold in the UK’s crypto market but also reflects concerted efforts by both PayPal and the UK to adapt to post-Brexit economic and regulatory changes while ensuring compliance in the evolving cryptocurrency landscape.