The UK Financial Conduct Authority (FCA) has published the final version of its crypto regulatory framework, setting a mandatory authorization deadline of October 25, 2027 for all regulated crypto activities. The rules apply to trading platforms, custodians, stablecoin issuers, lending and staking providers, and certain DeFi businesses with identifiable controlling entities.
Trading platforms face new disclosure duties, stablecoin capital ratio trimmed
Under the finalized rules, UK Qualifying Cryptoasset Trading Platforms must conduct due diligence and publish disclosure documents for every asset listed. The FCA scrapped a previous exemption for fungible cryptoassets, making the disclosure process uniform across all platforms. Stablecoin issuers must now comply with standards on reserve backing, custody, customer disclosures, and redemption procedures. Notably, the FCA removed redemption forecasting requirements and allowed limited intragroup custody arrangements. The K-SII capital coefficient for stablecoin issuance dropped from 2% to 1% after industry consultation. Reserve pools may hold up to 5% excess backing assets.
Market abuse regime refined, two-tier classification dropped
The regulator finalized a market abuse framework addressing insider trading and manipulation. Large platforms can continue using industry-led monitoring, but the FCA narrowed certain on-chain monitoring obligations and sharpened rules on inside information disclosures and intermediary notifications. The earlier two-tier cryptoasset classification proposal was replaced by a single framework: eligible assets on UK qualifying platforms face a 40% net risk position requirement and a 40% counterparty default volatility adjustment.
Authorization window opens September 2026, MLR registrations won't roll over
Firms can submit authorization applications between September 30, 2026, and February 28, 2027. Pre-application support meetings will begin in July 2026. Existing registrations under the UK Money Laundering Regulations (MLR) do not automatically transfer into the new regime; firms must obtain FCA authorization separately. Until the October 2027 deadline, the FCA will continue supervising crypto firms through financial promotion and anti-money laundering rules.
David Geale, FCA's executive director of payments and digital finance, called the framework a significant step for UK crypto regulation, offering firms greater certainty while preserving room for innovation. He reminded consumers that cryptoassets remain high-risk investments.