This article is part of the Autumn 2026 edition of Financial regulation quarterly, which covers practical insight on the regulatory developments in the sector.

The era of light-touch crypto oversight is over. On 30 June 2026, the Financial Conduct Authority (FCA) published five landmark policy statements delivering a comprehensive regulatory regime for cryptoassets – the culmination of more than three years of intensive work. For firms operating in or into the UK, the stakes could not be higher.

The legislative foundation

The new regime is underpinned by the Financial Services and Markets Act 2000 (FSMA) (Cryptoassets) Regulations 2026 (SI 2026/102), made on 4 February 2026. These regulations brought a broad range of cryptoasset activities within the FCA’s regulatory perimeter for the first time, moving well beyond the anti-money laundering and financial promotions standards that previously defined the regulator’s role in the market. 

Until the rules come into mandatory effect on 25 October 2027, the FCA’s oversight of crypto will continue to be largely limited to financial promotions and anti-money laundering controls. Firms wishing to carry on regulated activities from day one will be required to submit detailed and comprehensive applications for authorisation between 30 September 2026 and 28 February 2027. These dates are set by FCA direction pursuant to the regulations, rather than appearing on the face of SI 2026/102 itself.

What the rules require

The FCA has published five policy statements constituting the new framework, covering: Admissions and Disclosures and the Market Abuse Regime for Cryptoassets (MARC) (PS26/9); stablecoin issuance (PS26/10); regulated cryptoasset activities (PS26/11); a prudential regime for cryptoasset firms (PS26/12); and the application of the FCA Handbook to regulated cryptoasset activities (PS26/13). 

Key requirements across those policy statements include:

• Authorisation: Trading platforms, intermediaries, custodians, stablecoin issuers, and firms arranging staking must all obtain FCA authorisation to operate in the UK. 
• Capital and prudential requirements: All firms must meet financial resilience requirements including capital and stress testing. The K-factor requirement for stablecoins in issuance (K-SII) has been reduced from 2% to 1%, and cryptoassets that can be prudently valued and are admitted to a UK qualifying cryptoasset trading platform will be subject to a single 40% net risk position requirement for the K-factor for net client positions (K-NCP) and a 40% volatility adjustment for the K-factor for client counterparty default (K-CCD). The FCA has also introduced a proportionality framework based on own funds requirements for prudential disclosures. These figures are drawn from PS26/12.
• Market integrity: The FCA is introducing new market integrity rules covering insider trading and market manipulation for the first time in this sector. The core MARC framework has been maintained while targeted changes improve proportionality, clarity, and operability. For firms that have operated to date without any of this infrastructure, building it from scratch will be a significant undertaking. 
• Consumer protection: PS26/13 confirms that key FCA Handbook obligations – including the Consumer Duty, Conduct of Business Sourcebook, the Senior Managers and Certification Regime (SMCR), operational resilience, and financial crime frameworks – are being applied across regulated cryptoasset activities. In a sector the FCA regards as high risk, the bar for demonstrating compliance will be commensurately demanding, and a consumer’s signature on a risk warning will not be sufficient. 
• Safeguarding and custody: The FCA is proceeding with the application of Client Asset Sourcebook (CASS) 17 to client cryptoassets, with strong stakeholder support for enhanced protections around ownership rights, record-keeping, reconciliation, and private key management. Targeted exceptions to trust requirements have been introduced, the scope of control-based application clarified, and the settlement float model percentage limit increased to 2%. 

Why it matters

The UK is taking a major step forward, delivering a comprehensive regime that puts it at the forefront of responsible cryptoasset regulation globally. For the first time, cryptoasset firms will be subject to the full suite of obligations under the FSMA: threshold conditions, SMCR, Principles for Businesses, the Consumer Duty, operational resilience requirements, financial crime controls, and a bespoke prudential framework. 

What firms should do now

1. Apply early – and understand the window. Firms that apply within the window may, subject to the relevant conditions, continue specified activities under the savings and transitional provisions until their application is determined. Firms should apply as early as possible and seek to take advantage of the pre-application support meetings the FCA is offering. Firms that apply after the window closes cannot rely on those provisions and may need to cease activities until authorised. Missing or mishandling the window carries existential risk. 
2. Do not assume existing registration converts. Existing registrations do not convert automatically. Firms currently registered under the Money Laundering Regulations (MLRs) or authorised under the Payment Services Regulations or Electronic Money Regulations, and firms relying on a section 21 financial promotions approver, will need to seek authorisation if they carry on a regulated cryptoasset activity. Firms registered under the MLRs should note that the fit and proper requirements are broader than those under the MLRs - a gap analysis against the requirements and expectations of the new cryptoasset regulatory framework is essential. 
3. Build a credible implementation plan now. The FCA encourages firms to develop a clear, board-approved implementation plan that sets out who is accountable, what needs to change, and when. Firms that submit poor quality applications risk rejection, delay, or refusal of authorisation. The Pre-Application Support Service is available to assist, and independent legal advice when preparing an application is strongly recommended. 

This regime sets clear, predictable rules for firms across the full range of regulated cryptoasset activities – strengthening consumer protections, enhancing market integrity, and positioning the UK as a trusted, competitive home for responsible cryptoasset innovation. The mandatory regime comes into force on 25 October 2027. For firms operating in this sector, the time to act is now.

If you or your firm have any questions or concerns about the regulator’s newly introduced cryptoasset regulation, Browne Jacobson’s financial regulation team is happy to have that conversation.