Aave secures FCA approval for UK crypto operations

Despite the regulatory phase, AAVE token prices were under pressure alongside the rest of the crypto market.

Aave Labs announced on May 28 that its two subsidiaries in the United Kingdom, Push Labs Limited and Push Virtual Assets Limited, have been registered by the Financial Conduct Authority (FCA) to operate as crypto asset exchange providers in the UK.

The approval gives the companies permission to issue electronic money under the UK's Electronic Money Regulations 2011.

Ave pushes deeply into regulated Crypto services

In a post published by AVX, the approval will allow for “regulated cryptoasset activities and payment infrastructure” in the UK, including stablecoin on- and off-premises services.

The companies are assigned firm reference numbers 1031720 and 1031721, while Push Electronic Money's license bears reference number 900984.

According to Aave founder Stany Kulekov, the setup will allow users to move fiat currency directly into the Aave ecosystem in what he describes as a “directly integrated zero-fee on-ramp.”

It also links the FCA registration to EV's Europe-wide regulatory schemes, with reference to the company's MCA authorization through the Central Bank of Ireland for operations in the European Economic Area.

The announcement comes at a very busy time for the protocol. Earlier this week, Aave published a management “Temp Check” proposal for deploying V4 on Avalanche, including a dedicated liquidity hub for real-world assets.

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Former Ava Labs executive Luigi D'Onorio DeMeo wrote on X that Avalanche had a “huge opportunity” to build on-chain capital markets around the new version of the protocol.

It comes as the wider Diffie sector faces renewed scrutiny after several major exploits this year. Things got really bad yesterday, Openzeppelin founder Manuel Araoz warned users on X now that “not all DeFi is secure.”

AI-powered coding tools have tipped the scales heavily in favor of attackers, and Aven named it one of the platforms it no longer thinks is safe.

Ave was hit hard by an April exploit on KelpDAO. However, recent community discussion has focused on the response, with analyst Jose Fabrega praising the use of nearly $58 million from the Treasury to cover losses associated with rETH depositors after the crisis.

On April 25, a report on the recovery effort revealed that Kulekov pledged 5,000 ETH to the “DeFi United” initiative to stabilize markets after the exploit created a deficit of more than 100,000 ETH on related protocols.

AAVE price surveys

Despite the news of the UK approval, data from CoinGecko shows that at the time of writing, Aave's native AAVE token had plunged 5% in 24 hours to trade around $81.

That figure represents a nearly 10% decline over the past seven days, as well as a 17% decline over the past month. Still, Ave remains one of the largest DeFi lending protocols with over $13.6 billion in total value locked (TVL).