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- Cayman Island-headquartered Rtcoin does not have a license under KWG to operate in Germany.
- The details on the company’s website are enough to doubt that it is conducting banking and financial business without authorization.
- The authorities have cautioned users to conduct background checks before investing.
To avoid the re-occurrence of the FTX saga, regulating authorities in jurisdictions worldwide are scrutinizing all the exchanges working with them. South Korea has asked their exchanges not to issue tokens. And share the entire transitions report with the authorities. Germany’s financial regulator, BaFin, notified on Friday that Rtcoin is not authorized to operate in the country.
BaFin does not supervise Rtcoin.
The Greman Federal Criminal Police Office (BKA- Bundeskriminalamt) & the German state criminal police offices (Landeskriminalamter) have cautioned users seeking to invest money online. They should be cautious and conduct the required research ahead of time to diagnose deceit attempts at early stages.
BaFin said that the exchange is not registered under KWG, “Kreditwessengesetz,” for conducting finance-related services in the country. KWG-The Germany’s Bank Act that provides guidelines for the operations of entities providing financial and banking services. Germany’s crypto exchange platforms also fall under its operating radius.
“The company is not supervised by BaFin. The information provided on the company’s website, rtcoin.org, gives reasonable grounds to suspect that Rtcoin is conducting banking business and providing financial services in Germant without the required authorization.”
What is Rtcoin?
Rtcoin presents itself as the “world’s leading digital asset trading platform.” registered in the Cayman Islands, where it is headquartered.
Although the company website says about its operation in four jurisdictions, including the UK, it does not appear to be on the list of the Financial Conduct Authority (FCA) UK, neither on a permanent nor provisional basis. The company had stated German as one of its eight official service languages. It comes under the list of unregistered companies operating in the UK but is not associated with any regulatory agency.
What if Rtcoin is banned from Germany?
If a crypto exchange fails, all the funds invested by the users are stuck until further notice. One cannot withdraw or trade cemented funds. While if a bank fails, the investors are insured by the FDIC (Federal Deposit Insurance Corporation), which ensures that at least the base amount shall be given, if not the interest.
And if an exchange is banned from a country for improper licensing or delisting. The users will not be able to liquidate their holdings, and the HODLed cryptocurrency will be on HODL unless and until the ban is uplifted.
This is why investors are advised to do a thorough background check, from its owners to its projects, from its protocols to its licenses. Although it provides high rewards, it comes at higher risk too.
With a background in journalism, Ritika Sharma has worked with many reputed media firms focusing on general news such as politics and crime. She joined The Coin Republic as a reporter for crypto, and found a great passion for cryptocurrency, Web3, NFTs and other digital assets. She spends a lot of time researching and delving deeper into these concepts around the clock, and is a strong advocate for women in STEM.
