FCA Approves Operating License to Crypto Debit Card Provider

FCA Approves Operating License to Crypto Debit Card Provider

Wirex, a crypto payments provider, received an operating license from the Financial Conduct Authority (FCA) of UK. Apart from Wirex, trading giant Coinbase and crypto-startup Circle also received the approval. The license is known as E-money License.

The recipients of the certificate can freely operate in 23 countries from the European Union as well as issue personal International Banking Numbers, legal ATM cards, exchange services and hold client funds in segregated accounts instead of company accounts.

Founded as E-Coin in 2014 by Pavel Mateev and Dmitry Lazarichev, the company experienced a complete branding overhaul in February 2016, changing its name to Wirex. By September 2017, the company registered over $1 billion transactions, all in cryptocurrency, and boasted 800,000 users.

Wirex does not feature an ICO with millions of dollars to its credit. Instead, the London-based company is privately held and offers a mechanism to spend, receive and purchase cryptocurrency via a prepaid debit card. Notably, it raised $3 million in a Series A round led by Japan’s SBI Group in March 2018.

The platform currently supports over 50 altcoins including NEM, NEO and OMG, and recently added XRP and LTC to its roster. All crypto tokens can be readily converted to euros, dollars, and pounds at point-of-sale via an in-app API to Shapeshift.

The above system helps the company circumvent the retailer’s need to possess a cryptocurrency account to accept Wirex-enabled fiat payments.

Also, the company operates a payment service called W-Pay, which launched in September 2017. The network is integrated with Visa’s vast merchant network, which makes it possible to use cryptocurrencies in over 40 million outlets.

Finance Magnates reports Lazarichev said: “The license will not materially affect how we engage with our current clients, although they will benefit from more streamlined services and potentially even lower rates than we currently offer.”

As per reports, Wirex is pushing for additional licenses in Japan, Singapore and the U.S.

In March, the FCA granted Coinbase an E-Money License, allowing the so-called “Google of Cryptocurrency” access to U.K. banks and EU institutions. The move enabled millions of people to use euros and pounds to purchase cryptocurrencies.

Related: Blockchain Explorer Built on Ethereum Launched by Canadian Government

While the E-Money License is undeniably strict and takes over 90 days to process, the FCA has launched a regulatory sandbox for observing the business practices of fintech and blockchain firms in a protected testing environment.

Recently, in June and July, two U.K.-based cryptocurrency firms, Globacap and BlockEx, were accepted into the program. Both startups aim to utilize blockchain technology to facilitate faster payments.

While the developments mentioned earlier indicate the FCA’s favourable view of cryptocurrencies, the watchdog is similarly notorious for issuing multiple public warnings about cryptocurrencies and related business.

Reportedly, the FCA also recently sent a notice to U.K. banks asking them to apply “enhanced scrutiny” on cryptocurrency-flagged user accounts.