Former minister claims his Binance advisory role won’t involve ‘lobbying the FCA to regulate’
Lord Vaizey has joined Binance, a cryptocurrency exchange described by the City regulator as posing a “significant risk” to British consumers.
The former digital and culture minister has accepted a position on Binance’s new advisory board, an 11-strong body with members from around the world.
Earlier this year, the Financial Conduct Authority (FCA) said Binance’s offer of “complex and high-risk financial products” posed a “significant risk to consumers” in the UK.
Lord Vaizey said his advisory role “won’t involve me lobbying the FCA to regulate”, adding that lobbying for his former ministerial department “hadn’t even come into my head”.
“If I can help and advise [Binance] on what they need to do as a company in order to satisfy the regulator’s issues, then I’m happy to do that.”
The politician served as digital and culture minister in David Cameron’s governments during the 2010s. He has 24 second jobs registered with the House of Lords’ transparency register, spanning companies such as Deloitte, charitable lottery business Omaze and investment advice agency TISA.
Binance says it has 90 million users worldwide and claims to handle the equivalent of $76bn (£67bn) in cryptocurrency trades every day.
Chief executive Changpeng Zhao met the former digital minister at a Centre for Policy Studies event in Westminster held in March. Attendees reportedly said Mr Zhao was on a “charm offensive” and talked about resetting relations with British regulators.
As the cryptocurrency business revealed its new advisors on Thursday, Mr Zhao said: “With the [advisory board], we’re supercharging our ability to manage regulatory complexity by tapping into the highest level of expertise available anywhere in the world.”
Other members of its new advisory board include David Wright, a former deputy director general of financial services policy with the EU Commission, as well as Bruno Bezard, a former head of the French Treasury, and Max Baucus, a one-time US ambassador to China.
The cryptocurrency exchange faces significant “regulatory complexity” in Britain, according to the FCA. Last June the regulator warned that Binance was not authorised to offer financial products to British consumers, a position that has since eased slightly.
“This requirement was put in place because, in the FCA’s view, Binance Markets is not capable of being effectively supervised,” said the watchdog, adding that it “did not have powers to assess the fitness and propriety” of the owners of a Binance subsidiary, Bifinity.
Earlier this year Binance gained FCA approval for giving investment advice. An April statement said sterling deposits and withdrawals from the trading platform had been “resumed for Binance verified users”, following a previous freeze amid fresh concerns from the City watchdog.
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Post expires at 7:52pm on Thursday March 23rd, 2023