News - PayPal leaves (temporarily) United Kingdom

By Mike Hesp

PayPal leaves (temporarily) United Kingdom

Stablecoin
Developments

Last week presented PayPal its own Stablecoin, viz. PYUSD. With this, PayPal aims to compete with other publishers of stablecoins such as Circle and Tether. This announcement marks a significant move for PayPal, which although a traditional financial powerhouse, also has a significant presence in the crypto world.

Now PayPal decides to step back in the U.K., as reported by CoinDesk based on a statement of the company. This means that, for now, PayPal is discontinuing the ability to offer cryptocurrencies to customers in the UK. This decision stems from recently tightened Financial Conduct Authority (FCA) regulations, which now require firms to "implement additional measures" before customers can buy crypto. This likely refers to mandatory identity checks and money laundering prevention checks.

Customers who have previously purchased cryptocurrencies through PayPal will retain the right to keep and sell them. However, as of Oct. 1, the ability to make new purchases will be disabled.

Tighter regulation of crypto companies in the UK is no surprise, and PayPal is not escaping it. Although the UK wants to brand itself as a "crypto hub" with favorable regulations, strict identity checks and anti-money laundering measures remain hard requirements. The measure taken is expected to be temporary in nature, with plans to restore the ability for purchases in early 2024 once all regulations are met.

Earlier this year, British banks even blocked payments to crypto exchanges. Still, the crypto industry won a victory earlier this summer, as crypto is officially considered a form of investment in the UK, not gambling.

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