UK ministers are preparing a new wave of crypto regulations that would bring most digital asset activity under full Financial Conduct Authority (FCA) supervision by 2027, aiming to close gaps exposed by exchange failures and offshore scandals.
UK Treasury Outlines Broader FCA Perimeter
The Treasury’s plan extends beyond the current anti–money laundering and terrorist financing registration regime, which already requires UK-based crypto firms to meet basic compliance standards. Instead, officials want a full authorization framework that treats major crypto businesses more like investment firms or payment institutions, with permissions tied to specific activities such as exchange operations, custody, lending, and advisory services.
Under the proposals, any firm that serves UK users with core crypto services would need a license and ongoing supervision from the regulator. That framework would likely cover both centralized platforms and some DeFi front ends that exercise effective control over user assets or governance levers, even if underlying smart contracts remain open source.
The Treasury also signals tougher rules on asset listings, conflicts of interest, and disclosures around staking, yield products, and token distributions.
Consumer Protection and International Alignment
Policymakers link the push to a series of high-profile collapses, from offshore exchanges to domestic failures that left UK customers with limited recourse.
By 2027, the government wants a regime that sets clear standards for segregation of client assets, operational resilience, and wind‑down planning, so that a platform failure looks more like a supervised insolvency than an uncontrolled loss of funds.
Additionally, the Treasury wants to connect itself more closely with other important countries. Large companies are already under pressure to standardize compliance across markets due to EU MiCA regulations and new U.S. enforcement practices, and UK authorities want London to maintain its competitiveness without being seen as risk-averse.
Decisions on issues such as marketing regulations, leverage caps, and whether certain stablecoins can be integrated into the main payment systems will be influenced by this balance.
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