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Key Insights Gibraltar regulator cancels Quickbit's operating license over anti-money laundering failures Extensive investigation found lack of customer due diligence and politically exposed persons checks Quickbit winding down Gibraltar subsidiary already, so avoids fines but sees reputation hit GIBRALTAR - Gibraltar financial watchdog the GFSC has canceled the operating license of Swedish cryptocurrency firm Quickbit, restricting its ability to keep local virtual asset activities - a severe reprimand for anti-money laundering breaches uncovered during a February 2023 inspection. In an investigation decision notice on Wednesday, the Gibraltar Financial Services Commission (GFSC) said numerous customer due diligence deficiencies were spotted across Quickbit's business lines earlier in 2023 but satisfactory fixes were not implemented despite months of warnings. The GFSC enforcement unit consequently determined cancellation of Quickbit's registration was proportionate given systematic lack of money laundering checks and know-your-client protocols - particularly around politically-exposed persons. The decision notice follows an extensive investigation after an onsite visit that identified contraventions, the financial services regulator outlined on Wednesday, emphasizing the seriousness of still-unresolved violations. No Fines But Hefty Reputational Blow for Quickbit in Gibraltar While avoiding fines proposed during earlier enforcement discussions, cancellation essentially curtails Quickbit's capacity to continue virtual asset operations in the British overseas territory - long an attractive base given progressive crypto laws. Quickbit said the loss only impacts a Gibraltar subsidiary handling customer intake since 2020. With senior leadership already planning to wind down the outpost's activities from early 2023, day-to-day operations via Sweden offices remain assured. The investigation in Gibraltar has consumed significant resources and delayed our process of shutting down the subsidiary. I am pleased and relieved with today's decision, Chief Executive Daniel Sonesson told media. Yet reputational damage with clients and investors PLU potentially lingers despite Sonesson's assurances no fines were ultimately tabled over the AML shortfalls. Scrutiny of cryptocurrency controls also continues ratcheting higher worldwide after last year's FTX collapse shone light on sector vulnerabilities. Quickbit must now concentrate on keeping houses in order elsewhere as old Gibraltar entities enter run-off mode, still facing lengthy GFSC monitoring for full closure. Falling foul of the regulator spotlights how DeFi players must continually adapt to rising supervisory benchmarks even as decentralization maximizes.

Quickbit Loses Gibraltar License After Anti-Money Laundering Breaches

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