The German Federal Financial Supervisory Authority (BaFin) has issued a warning against XSC Finance for offering investment and crypto-related services through the xsc.finance website without proper authorization.
According to BaFin, XSC Finance, which lists addresses in Krefeld and London, is providing pre-market equity deals, crypto asset management, personalized investment advice, and broader asset management services without holding the required authorization. Under German law, any entity providing banking, financial, investment, or crypto-related services must obtain a license from BaFin. The regulator emphasized that XSC Finance does not appear in its public register of authorized companies. This alert was issued in accordance with Section 37(4) of the German Banking Act (KWG), which permits BaFin to inform the public about entities conducting unauthorized financial activities in Germany.
Section 37 of the German Banking Act (KWG) allows BaFin to intervene against unauthorized banking activities or financial services. If a company operates without necessary licenses or engages in prohibited transactions, BaFin can order the cessation of operations and appoint a liquidator to handle the settlement. The authority also has the power to inform the public if a company is suspected or found to be engaging in unauthorized activities.
Blockpit’s analysis of Europe’s safest licensed cryptocurrency exchanges ranks Binance first due to its regulation in multiple European countries, AES-256 encryption, and the SAFU (Secure Asset Fund for Users) program for user protection. Coinbase takes second place with 98% of assets held offline, licensing by BaFin in Germany, and advanced security protocols. Kraken ranks third by storing 95% of assets in cold wallets and adhering to regulations across the EU and other regions.
BaFin oversees the stability and integrity of Germany’s financial system. It supervises banks, financial services institutions, payment institutions, e-money institutions, insurers, asset managers, and other related entities. Its responsibilities include solvency supervision, market supervision to ensure fair and transparent conditions, and preventing misuse for money laundering or terrorist financing.
