FCA Seeks Public Views on Bringing Crypto Under Traditional Financial Standards

The UK’s financial watchdog is seeking public feedback on how far its existing rulebook should stretch into the fast-moving crypto sector. The consultation marks another step in the government’s plan to bring digital assets under a formal regulatory regime.

Expanding the FCA’s Reach

The Financial Conduct Authority (FCA) has launched a consultation paper to examine how existing provisions in its handbook would apply to firms carrying out regulated crypto asset activities. The move comes as HM Treasury prepares legislation to introduce a new framework for the sector.

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At present, FCA oversight of crypto is limited to financial promotions and anti-money laundering Money Laundering Money laundering is a blanket term to describe the process by which criminals disguise the original ownership and proceeds of criminal conduct by making such proceeds appear to be derived from a legitimate source.Money laundering is an issue that traverses countless industries and sectors, which includes the financial services space. Though criminal money may be successfully laundered without the assistance of the financial sector, billions of dollars’ worth of criminally derived money are laund Money laundering is a blanket term to describe the process by which criminals disguise the original ownership and proceeds of criminal conduct by making such proceeds appear to be derived from a legitimate source.Money laundering is an issue that traverses countless industries and sectors, which includes the financial services space. Though criminal money may be successfully laundered without the assistance of the financial sector, billions of dollars’ worth of criminally derived money are laund Read this Term requirements. The regulator now plans to broaden its remit, covering areas such as governance, operational resilience, financial crime controls, and environmental, social, and governance standards.

The consultation also seeks views on how crypto firms should meet the Consumer Duty, a requirement that financial services providers act to deliver good outcomes for retail clients. Other areas under discussion include the Conduct of Business Sourcebook, product governance rules, and access to the Financial Ombudsman Service.

Under the proposals, companies would need to apply for FCA authorization before conducting regulated crypto asset activities in the UK. The regulator argues this will ensure higher standards and greater consumer protection.

Building Trust Through Oversight

The consultation highlights the regulator’s aim to balance innovation with market integrity. By extending established standards to crypto firms, the FCA seeks to create a more sustainable environment for digital assets while addressing risks linked to financial crime and business failures.

The proposals affect a wide range of stakeholders, including crypto firms, industry groups, auditors, advisers, consumer representatives, policymakers, and academics.

Related: FCA to Allow Retail Investors to Gain Access to Crypto ETNs Starting October

The FCA is inviting comments on discussion chapters of the paper by 15 October 2025 and feedback on the full proposals by 12 November 2025. The outcome will shape the regulatory landscape for crypto assets once HM Treasury’s legislation takes effect.

Early this year, the FCA announced that it would lift its ban on retail access to cryptoasset-backed exchange Exchange An exchange is known as a marketplace that supports the trading of derivatives, commodities, securities, and other financial instruments.Generally, an exchange is accessible through a digital platform or sometimes at a tangible address where investors organize to perform trading. Among the chief responsibilities of an exchange would be to uphold honest and fair-trading practices. These are instrumental in making sure that the distribution of supported security rates on that exchange are effectiv An exchange is known as a marketplace that supports the trading of derivatives, commodities, securities, and other financial instruments.Generally, an exchange is accessible through a digital platform or sometimes at a tangible address where investors organize to perform trading. Among the chief responsibilities of an exchange would be to uphold honest and fair-trading practices. These are instrumental in making sure that the distribution of supported security rates on that exchange are effectiv Read this Term-traded notes (cETNs) from October, following a consultation launched in June. Retail investors will be able to trade cETNs provided they are listed on UK-recognized investment Exchanges.

The FCA said firms offering these products must comply with financial promotion rules, requiring that information provided to clients is clear, accurate, and not misleading. Incentives to invest must also be appropriate and not create undue pressure on retail investors.