TikTok faces allegations of operating a cryptocurrency exchange-like business in the UK

PANews reported on October 17th that, according to Cryptonews, the short video app TikTok is under review for allegedly operating in a manner similar to cryptocurrency exchanges in the UK.

It is reported that a compliance expert has issued a warning to the UK Financial Conduct Authority (FCA), suggesting that TikTok be checked for money laundering and terrorist financing. The expert pointed out that virtual tokens on TikTok could potentially be indirectly exchanged for real currency through its creator program, which raises concerns.

The review stems from TikTok's virtual currency system - TikTok Tokens. Users can purchase tokens with real money and gift them on the platform or during live streams. They also have the possibility of exchanging these tokens back into cash. This process is similar to cryptocurrency trading. As cryptocurrency businesses face strict regulation, this system has raised regulatory concerns. Critics believe that how TikTok handles virtual currencies may undergo scrutiny similar to crypto platforms. Additionally, such crypto-like transactions have raised concerns about user financial data security, especially considering geopolitical sensitivities.

According to reports, it was written in the letter: "TikTok provides funds transfer services for money service businesses through its rewards program and carries out exchanges between encrypted assets and currencies or arrangements related thereto." At press time, neither TikTok nor FCA had responded to Cryptonews' request for comment.