Home Market Poloniex’s challenges mount with FCA warning and user withdrawal issues

Poloniex’s challenges mount with FCA warning and user withdrawal issues

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The UK Financial Conduct Authority (FCA) has added another Justin Sun-linked crypto exchange, Poloniex, to its warning list of companies offering financial services without permission within its jurisdiction.

A Dec. 6 update from the financial regulator stated:

“[Poloniex] may be promoting financial services or products without our permission. You should avoid dealing with this firm.”

The FCA emphasized that the company lacked authorization to engage with UK residents regarding its product offerings. Moreover, the regulatory body highlighted that individuals involved with the company can’t utilize the Financial Ombudsman Service for grievances, nor would they fall under the protection of the Financial Services Compensation Scheme.

Poloniex has yet to respond to CryptoSlate’s request for comment as of press time.

Over recent months, the FCA has consistently revised its roster of unlicensed cryptocurrency entities functioning within its jurisdiction. This list encompasses prominent platforms such as Bitfinex, HTX, KuCoin, and Phemex.

The FCA’s regulation stipulates that all financial enterprises operating in the UK must either hold authorization or registration with the regulatory body.

Asset withdrawal challenges

Meanwhile, the FCA warning about Poloniex is coming at a precarious time for the exchange, as many users lament their inability to withdraw their assets from the platform.

Poloniex halted deposits and withdrawal functions for users following a $100 million hack in November.

Although the platform has made progress in restoration efforts, only selected tokens like USDD, USDT, BitTorrent’s BTT, Sun Token SUN, and USDC became available for withdrawal via the Tron Network as of Dec. 5.

However, the company has pledged to extend withdrawal services to major cryptocurrencies, like BTC and ETH, within the upcoming fortnight.

Discount trading

Amid the exchange’s challenges, various cryptocurrencies are trading at a slight discount to their original value on rival platforms like Binance.

For context, data from Poloniex shows that its BTC/USDT trading pair was trading at $43,028, and the same trading pair was exchanging hands for $43,229 on Binance as of press time.

Similarly, its ETH trading pair is also experiencing a discount of roughly $32 compared to that of Binance.

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