FCA updates on crypto regulation approach

The FCA has updated on its approach to crypto regulation in the UK, including an indicative roadmap of key dates and a series of focused consultations.

Recent research from the FCA found that approximately 1/3 of people thought they would be able to raise a complaint with the FCA if something went wrong with their crypto investment and they were seeking financial protection. Matthew Long, director of payments and digital assets at the FCA, said the research highlighted the need for clear regulation to support a safe, competitive and sustainable crypto sector.

The roadmap sets out the following planned FCA policy publications :

• Q4 2024 – discussion paper(s) on:
  • admission and disclosures, including: admission and rejection procedures; disclosures; liability; due diligence; National Storage Mechanism (NSM); and
  • market abuse, including: systems and controls; information sharing; inside information disclosure
• Q1/Q2 2025 – discussion paper(s) on:
  • trading platform rules, including: location; access; matching and transparency requirements;
  • intermediation rules, including: order handling and execution requirements;
  • lending rules, including: ownership; access; and disclosures;
  • staking, including: ownership and disclosures; and
  • prudential considerations for cryptoasset exposures
• Q1/Q2 2025 – consultation paper(s) on:
  • stablecoins, including: backing assets and redemption;
  • custody, including: recordkeeping; reconciliations; segregation of assets; and use of third parties;
  • introduction of a new prudential sourcebook, including capital, liquidating and risk management
• Q3 2025 – consultation paper(s) on:
  • conduct and firm standards for all RAO activities, including: systems and controls; Consumer Duty; complaints; conduct (COBS); and governance;
  • admission and disclosures, as per the discussion paper
  • market abuse, as per the discussion paper
• Q4 2025 / Q1 2026 – consultation paper(s) on:
  • trading platforms, intermediation, lending and staking, as per the discussion paper(s)
  • remaining material for prudential sourcebook, including: groups and reporting

The roadmap also sets 2026 as the target date for all policy statements to be published. The FCA provides no further dates, but after this point there will be preparatory gateway work, gateway opening and regime go-live.

The FCA stressed that the roadmap is non-exhaustive, with all timelines being subject to change according to parliamentary time and/or further guidance from the government.