Summary
The FCA's finalised cryptoasset regime — set out in policy statements PS26/11, PS26/12 and PS26/9 — brings UK cryptoasset firms within a framework that closely resembles traditional financial services regulation, covering conduct, prudential requirements, and market abuse. Ahead of the 25 October 2027 implementation date and the authorisation window (30 September 2026 to 28 February 2027), crypto firms must begin assessing their readiness.
Key Points
- The regime: The FCA published a comprehensive framework for regulated cryptoasset activities ahead of the regime's implementation on 25 October 2027. From October 2027, firms wishing to carry on regulated cryptoasset activities in the UK will generally need to obtain FCA authorisation and demonstrate ongoing capability to meet expectations.
- PS26/11 (Conduct): Introduces a new CRYPTO sourcebook. Qualifying cryptoasset trading platforms (QCATPs) face new execution venue and best execution requirements for UK retail clients. Cryptoasset intermediaries must "take all reasonable steps" to ensure orders are executed on UK-authorised execution venues with the best possible result.
- Lending and borrowing: Prescriptive collateral requirements for retail lending and borrowing — over-collateralisation, negative balance protection, restrictions on supplementing client collateral, and express client consent for collateral use. Retail client collateral must be safeguarded under CASS requirements, a significant departure from existing market practices where collateral was transferred outright to the firm.
- Staking: Rather than restricting access, the final rules require firms to provide retail clients with clearer information on the nature of staking services, the risks, and the terms of arrangements.
- PS26/12 (Prudential): Introduces new CORPRU and CRYPTOPRU sourcebooks, subjecting firms to capital, liquidity, risk management, concentration risk and public disclosure requirements — mirroring the prudential architecture familiar to investment firms under MiFIDPRU.
- Consumer duty: Firms dealing with retail clients become subject to the consumer duty, requiring good consumer outcomes and avoidance of foreseeable harm. Firms will need to test, monitor and adapt customer communications to ensure genuine understanding.
- PS26/9 (Admissions and market abuse): QCATPs become gatekeepers to retail cryptoasset markets — required to conduct due diligence and reject listings detrimental to consumers, and publish qualifying cryptoasset disclosure documents. Introduces the market abuse regime for cryptoassets (MARC), influenced by UK MAR, covering insider dealing, unlawful disclosure and market manipulation, with primary responsibility on QCATPs and intermediaries.
- The authorisation window: Applications may be submitted between 30 September 2026 and 28 February 2027. Given the substantial nature of the reforms, firms must begin assessing readiness now.
- The significance: The UK regime positions Britain alongside the EU's MiCA as a major regulated cryptoasset market. The framework's alignment with traditional financial services regulation — governance, capital, consumer duty, market abuse — represents a substantial shift for firms that have historically operated outside the scope of the FCA Handbook, requiring significant implementation and gap-analysis work.