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FCA and HTX enter settlement talks over alleged illegal UK crypto promos
A High Court case has been paused until late August while the FCA seeks an injunction and a declaration that HTX breached UK rules on unauthorized financial promotions.
The UK Financial Conduct Authority is negotiating a potential settlement with crypto exchange HTX after the regulator claimed the platform illegally promoted crypto services to UK consumers, according to court filings cited by Reuters.
Proceedings in London's High Court have been paused until late August to give the parties time to reach terms, Reuters reported. The FCA’s enforcement action follows the start of proceedings on October 21 last year, which it described as the first of its kind against a crypto exchange over marketing, with the claim published in February.
The FCA is seeking an injunction and a declaration that HTX and related parties breached section 21 of the Financial Services and Markets Act, which bars unauthorized financial promotions. The particulars name Huobi Global S.A., incorporated in Panama in May 2023, and four categories of “persons unknown,” including anyone who owns or controls htx.com or runs the exchange’s platform and social accounts, with roles potentially covering periods extending to late 2028.
In its claim, the FCA details how it said UK users could still trade: an FCA employee, working from a UK IP address, bought crypto through HTX’s peer-to-peer service and executed futures trades on two pairs after verifying their identity with a UK driving license. The regulator also pointed to HTX operating in English, accepting GBP, and accepting UK photo ID, and said HTX’s terms restrict UK retail users from derivatives in a way the FCA argued did not actually stop futures trading, Reuters reported.