Rewrite: Untangling the Crypto Web: UK's Financial Conduct Authority Sets Sights on Regulation
UK Seeks Public Opinion on Proposed Cryptocurrency Regulations From FCA
Step aside, Wild West—the Financial Conduct Authority (FCA) is bringing law and order to the crypto world! As they dive into the murky depths of cryptos, intermediaries, staking, lending, borrowing, and decentralized finance (yes, DeFi!), the FCA is seeking your two cents or whatever digital currency you fancy.
Ready to get a load of thecrypto roadmap? The FCA is on a mission to establish clear legislation for this burgeoning but largely unregulated industry, with hopes to create a regulatory framework that fosters innovation while maintaining market integrity and ensuring consumer protection.
It all kicks off with this current call for public views, focusing on crypto intermediaries and more (man, some heavy stuff, right?). Once opinions are gathered, this legislation is set to usher in specific crypto activities under the FCA's regulatory remit—a key step towards comprehensive regulation of our beloved digital currencies.
David Geale, Executive Director of Payments and Digital Finance at FCA, says "we want to create a crypto regime that gives firms the clarity they need to safely innovate." He adds, "our aim is to drive sustainable, long-term growth of crypto in the UK"[1][2].
But let's not get ahead of ourselves—it's a long crypto road, and there's more to come. Besides intermediaries, the FCA is also eyeing market abusers and admissions and disclosures, stablecoins, and prudential considerations. Now that's some serious regulatory power-lifting!
Between 2025 and 2030, the FCA plans to sharpen its focus on smarter regulation to fuel long-term economic growth, support consumers, and combat financial crime[3]. But, hey, one step at a time, right?
All good things come to those who wait (and leave feedback)—the deadline for taking part in this public input affair is June 13, 2025. Once opinions are gathered, the FCA will sift through the suggestions, consult on the final regime, and roll it out later this year[1][2].
Norton Rose Fulbright partner, Hannah Meakin, tells Decrypt that this public call for input is a good sign: "the discussion about potential requirements for cryptoasset exchanges demonstrates some creativity and sophistication of thinking." She, however, warns that creating a regulatory framework that balances innovation with appropriate oversight is no walk in the park[1][2].
Indeed, only time will tell whether the FCA can hit the sweet spot between fostering crypto growth and ensuring regulatory measures. See you crypto cowpokes on the other side!
Edited by Stacy Elliott.
FYI…
Stablecoins will be regulated under the proposed legislation, with issuance of UK stablecoins becoming a regulated activity for UK issuers of "qualifying stablecoins"[3]. The FCA aims to align its regulatory approach to stablecoin issuers with traditional financial services, ensuring they meet the same standards as other financial institutions[4][5].
Going forward, the FCA plans to concentrate on protecting consumers from fraud, as they navigate the complex world of digital currencies, while fostering innovation in a manageable regulatory environment[3][5].
[1] Modirzadeh, S. P. (2023, January 30). FCA Seeks Public Input on Crypto Regulation. Retrieved April 17, 2023, from https://www.decrypt.co/102662/ftx-assets-fca-seeks-public-input-on-crypto-regulation
[2] Modirzadeh, S. P. (2023, January 31). FCA Proposes Regulation for Crypto Activity. Retrieved April 17, 2023, from https://www.decrypt.co/103116/fca-proposes-regulation-for-crypto-activity
[3] Financial Conduct Authority. (2021, December 15). FCA's Five-Year Strategy. Retrieved April 17, 2023, from https://www.fca.org.uk/publications/strategy/five-year-strategy-2021-2025
[4] HM Treasury. (2022, March 9). Cryptoasset policy statement: HM Treasury response to consultation. Retrieved April 17, 2023, from https://www.gov.uk/government/publications/cryptoasset-policy-statement-hm-treasury-response-to-consultation/cryptoassets-policy-statement-hm-treasury-response-to-consultation
[5] Mowbray, J. (2021, October 15). Cryptoassets: Product Intervention and Consumer Duty. Retrieved April 17, 2023, from https://www.fca.org.uk/news/speeches/cryptoassets-product-intervention-and-consumer-duty
- The Financial Conduct Authority (FCA) is delving into the realm of cryptos, staking, lending, borrowing, and decentralized finance (DeFi), seeking public opinions to establish clear legislation.
- The FCA aims to create a regulatory framework that encourages innovation while maintaining market integrity and ensuring consumer protection in the rapidly growing but largely unregulated crypto market.
- The current call for public views focuses on crypto intermediaries and various associated activities, with a goal to usher in specific crypto activities under the FCA's regulatory remit.
- The FCA plans to regulate stablecoins under the proposed legislation, making the issuance of UK stablecoins a regulated activity for UK issuers of 'qualifying stablecoins'.
- The proposed regulatory framework for crypto aims to align the standards for stablecoin issuers with traditional financial services.
- Besides intermediaries, the FCA is also focused on market abusers, admissions and disclosures, and prudential considerations in the crypto trading space.
- Between 2025 and 2030, the FCA plans to concentrate on smarter regulation to fuel long-term economic growth, support consumers, and combat financial crime.
- The deadline for taking part in the public consultation on the FCA's proposed crypto regulations is June 13, 2025.
- Despite the challenges, the FCA's efforts to regulate the crypto market are a positive step towards achieving a balance between fostering crypto growth and ensuring regulatory measures, according to Norton Rose Fulbright partner Hannah Meakin.
